7 things i tell buyers in this market
DESCRIPTION
About once or twice per week, I get a phone call that starts with, “Hi David, my name is blank, and I’ve been reading your blog for the last six months or so, and well, my boyfriend and I are looking to buy a house in Toronto.” I’m always excited at the prospect of a new client, but today’s clients can be basically grouped into three categories: 1) Condo Buyers 2) House Buyers over $1,000,000 3) House Buyers under $1,000,000 Those are three very different buyers, working in three very different markets. And it’s that #3 market that is so incredibly tough in 2014′s Toronto, and it is to those potential buyers that I give the brutally honest truth. I’ve surmised in past blogs that part of the reason the $600-$800K price point in Toronto is so hot is because of Jim Flaherty’s decision two years ago to implement a mandatory 20% down payment on houses over $1,000,000. This was intended to cool down the market, by causing borrowers to take on less debt, and take some of the borrowers out of the market, but instead, it caused the sub-$1M price point to catch fire. You might say that overnight, $650,000 homes went up to $750,000. And every house that’s listed for $599,000 today seems to be selling for upwards of $800,000. So when I get a new buyer on the phone, and they tell me, “We want to buy our first home in Toronto,” I don’t waste any time telling them what the market is like. I’m paraphrasing myself, but these are the bullet points I’ll make during our initial conversation, and yes, I’m aware that these are, in essence, generalizations:TRANSCRIPT
