Think NYC Real Estate is Scary? This City Might Be Worse
Lately, social media is abuzz with Toronto’s insane real estate offerings: undesirable homes (in serious need of renovation and lacking ordinary amenities) selling at unbelievably high prices. Properties lacking everything from parking spaces to proper bathrooms have been selling at double and triple the asking price—with no signs of the area’s inflated costs slowing down anytime soon.
Columnist Robyn Urback has been highlighting some of the city’s most shocking sales on her Twitter feed, and her findings are unsettling to say the least. Here are a few of the most alarming examples she’s documented:
An insanely dated two-story—complete with a ridiculously retro kitchen (sans appliances, of course)—that sold for $988K at double the asking price:
A cramped three-bedroom abode—with gasp, only one shared bathroom!—that sold for nearly $2M:
An outdated house that first sold for $920K earlier in the year, and with no renovations or updates, sold for $1.125M just four months later:
A tiny property—so close to the neighboring house that you could reach out your window and touch it—that sold for over $1.2M:
And this humble home that sold for a full million dollars over the asking price:
And while these listings might appear funny when they pop up in our social media feeds, in real life, Toronto real estate is truthfully pretty terrifying. To make sense of it all, we called on Canadian real estate guru Mitch Parker—founder of Mitch Parker Group—to help us break down Toronto’s market inflation.
“Saying the market has changed in the past five years is a huge understatement.” Parker says. “Prices in the greater Toronto area averaged around $500,000 in 2012 and now sit above $900,000 (with many properties selling for $1M and more).” He adds, “Neighborhoods that were once empty or comprised of old buildings are now bustling with construction or new condos and retail.”
The reasoning, as Parker explains, is actually quite simple: “A lack of supply in the housing market has driven up prices and created a greater demand—which in turn drives up the cost of condos, houses, and other properties.” What’s more, he says, “Toronto is really starting to be recognized as a world-class city. The strong economy, local attractions, proximity to other major cities, and even professional sports teams all make it a safe and attractive option for buyers looking for a big city to call home.”
But there’s a sad cloud looming over T.O.: As desirable as the city is for people who want to live there, a number of the homes scooped up in the city sit vacant. The exponential growth of the market makes it a massive draw for investors around the world, who leave the properties they purchase totally unoccupied; Metro News estimates that 15,000 to 28,000 homes in the city of Toronto are without any occupants at all—not even renters. It’s led the city to consider legislation that taxes empty homes.
Although the future of the Toronto real estate market remains to be seen (recent data shows Toronto prices are steadily dropping, so that’s good news?), Parker believes the currently high costs of housing are just part of living the big city dream. “If you want to live in a city as great as Toronto, there’s going to be a price attached to it,” he says. “Most people that move to Manhattan or downtown London know they won’t ever own property there. I don’t think there’s anything wrong with that as long as you’re renting and investing in somewhere you can afford.”