New hunting grounds eyed as Toronto real estate market tightens
Toronto real estate agents reveal some ‘undiscovered’ neighbourhoods
By Carolyn Leitch – Globe and Mail
Cold, blustery spring weather is keeping tree limbs bare and gardens brown. But even the snow on Easter weekend did not keep Toronto home hunters from touring open houses and entering bidding wars with gusto.
“It is busy. There are wall-to-wall offers going on,” says one Toronto real estate agent, who expects business to heat up even more when the daffodils begin to bloom.
He says supply is tight and demand is high in neighbourhoods such as the Beaches and Yonge and Eglinton.
“The fall real estate market just never seemed to get off the ground and it seems a lot of buyers were re-evaluating,” he explains. But the spring has brought renewed enthusiasm, he says. The numbers confirm that Canada’s resale housing market remained frothy in the first three months of 2007.
A record number of houses changed hands across the country, according to numbers released this week by the Canadian Real Estate Association.
Still, the clip slowed in March as the average price in Toronto rose 3.4%, compared with the same month last year.
In Edmonton, meanwhile, the average resale price jumped an eye-popping 48%, making it the most rapacious housing market in the country.
In the market for new houses, Toronto-Dominion Bank economist David Tulk notes that there has been a gradual easing from what had been an extremely high level. Still, he remains upbeat about the outlook.
“Although the longer-term trend in housing starts has been down, the housing market in Canada remains healthy,” Mr. Tulk says.
In Ontario, he adds, the risk of dramatic decline in housing starts is still small because of the balanced resale market and a steady interest rate environment.
But despite a somewhat cooler pace of growth in Toronto, any increase knocks a few more buyers out of contention as the price of a house climbs further out of reach for some looking for a home.
“First-time buyers are running out of areas where they can still buy a home,” says Carol Pyke of Coldwell Banker Terrequity Realty.
Potential homeowners are searching harder to find overlooked areas that offer more moderate prices than the most trendy downtown neighbourhoods. Some buyers are extending their search farther east or west, while developers are rapidly building new houses and condos on industrial land.
Up-and-coming communities, agents say, include New Toronto, Runnymede, Cedarvale, Corktown and Birchmount Heights.
“All you have to do is track where they’re opening the next Starbucks and you have the next hot real estate market,” says another Toronto real estate agent.
She notes that people who are renting in High Park but can’t afford to buy there – where large, detached homes typically sell for between $700,000 and $1-million – are looking west to Mimico and New Toronto.
She has listed a three-bedroom, two-storey house at 121 Sixth St., which she describes on the multiple-listing service website as “cute, cozy, detached,” for $339,900.
“It’s in move-in condition,” Ms. Pyke says. “It’s adorable.”
The house has a wood-burning fireplace in the living room and a large backyard with a perennial garden.
“It has a lovely front veranda and great curb appeal,” the agent adds.
The house is in a pocket of New Toronto known as Lakeshore Village, which includes the shops along Lake Shore Boulevard West and the houses on the nearby streets running south to Lake Ontario, between Fourth and 13th streets.
She figures a house of similar size and amenities closer to downtown would sell for $600,000 or more.
Lakeshore Village has much to offer, including the waterfront trail for walking and cycling, the expansive Colonel Samuel Smith Park and the Lakeshore Yacht Club, she says. The Toronto Transit Commission streetcar runs along Lake Shore, and the Mimico GO station is a short drive away.
She notes that people see the colourful main street life of Bloor West Village or Roncesvalles Village and want that same sense of community.
Unfortunately for first-time buyers, the appeal and proximity to downtown of those areas has sent prices there soaring.
A third Toronto real estate agent says the Annex and Cabbagetown are still seeing lots of action in the centre of the city, but for younger couples or single professionals, Corktown is a rapidly emerging neighbourhood.
The triangle of land between Queen Street East, Eastern Avenue and Parliament Street has many new “infill” projects springing up in the spaces between clusters of little mews homes built at the turn of the 20th century.
“There are some weird and wonderful streets,” he says.
Bright Street, for example, with its line of grey Victorians, is frequently used in movie shoots. Wilkins Avenue, Ashby Place and Wascana Avenue are also charming, he adds.
Farther north, Leaside and the area surrounding Avenue Road and Lawrence Avenue continue to be highly coveted.
Prospective buyers who find those neighbourhoods too high priced may look to Cedarvale for a family home, Mr. Silver says. While the area near Bathurst Street and St. Clair Avenue is “a little patchier,” he explains, Cedarvale still offers easy access to downtown and good schools.
Houses with a main-floor family room — which remain at the top of the list for parents of young children, he says — can still be found for under $1-million.
People with perhaps half that amount to spend are more likely to head to an area such as Runnymede, which is north of St. Clair and east of Jane Street. The Junction area nearby is seeing lots of new condos and lofts.
“There are still good buys in those areas,” he says.
One Toronto real estate agent, who specializes in the Beaches, and he says business has been brisk in the ever-popular neighbourhood. But the agent says house hunters seem increasingly reluctant to enter into bidding wars.
“Buyers are starting to get sick of it.”
In some cases, agents have tried to generate a multitude of offers by bringing a house to market with a low asking price.
But he knows of one semi-detached on “a good Beaches street” that didn’t attract a single offer at $429,000. Ironically, when the price was increased to $449,000, the house was sold immediately, he says.
“You don’t need a bidding war to get the best price,” he says. “It sometimes backfires.”
He is working with some enthusiastic first-time buyers who are realistic about their prospects. With a relatively puny $350,000 budget, “they’re not expecting to get the world,” he says. Still, they may be successful at finding a property in the Beaches because they are willing to purchase a semi or a house that needs some fixing up, he adds.
For buyers who find the Beaches out of their range, Mr. Neal says Birchmount Heights is a good option. The area near Warden and Danforth avenues is about a five-minute drive from the Beaches, he says, and it’s a good, family neighbourhood.
“It’s affordable. It’s an up-and-coming neighbourhood because it hasn’t been on everybody’s map.”
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