Living next to Drake might not be as hard as you thought. If you’re looking for a mansion in the Bridle Path and are hoping to snag a deal, this might be the time to buy as Toronto’s tony neighbourhood saw an almost 30 per cent drop in home prices last month.
In June, the GTA’s housing market continued to soften as home prices dropped for a fourth consecutive month. But in Toronto, some pockets saw prices jump while others slumped.
The Bridle Path, an opulent neighbourhood in North York, continued to take a hit with an almost 30 per cent drop in the average home price from May to June, while The Annex area saw prices jump by almost 24 per cent, according to the latest figures from the Toronto Regional Real Estate Board (TRREB).
A significant reason for the variability in home prices across the GTA is low inventory even as some regions of the city still experience high demand, real estate experts say. And another Bank of Canada rate hike expected next week is continuing to make prospective buyers wait on the sidelines for the market to settle, they also note.
The average selling price for all houses and condos in June was $1.15 million, down from the February market peak of $1.33 million and the May average of $1.21 million.
“We’re seeing almost a 15 per cent drop from the February peak and with that drop and the rise of interest rates, those costs are almost offsetting each other,” said Toronto real estate agent Cameron Forbes. “It means we’ve hit the balance in terms of prices.”
Sales have also sharply declined by 41 per cent year-over-year — similar to the declines seen in the 2008 and 2009 global recession — but real estate experts expect activity in the market to level out in the fall as the initial rate hike shock wears off while buyer demand remains, especially for certain neighbourhoods.
“The desire to live in neighbourhoods where you can work comfortably and be close to restaurants and events will always remain desirable regardless of other market dynamics,” said Karen Yolevski, Royal LePage’s chief operating officer, corporate brokerages.
As people return to in-person work and immigration opens up again, urban centres remain attractive for many, Yolevski said.
“There are fluctuations when looking at home prices month-over-month by neighbourhood, but when looking at the city as a whole the trend line tends to go up,” she said. “There is an upward trajectory for growth in the GTA.”
The Annex—Yonge—St. Clair
The Annex—Yonge—St. Clair area, which includes Yorkville, South Hill, Summerhill, Wychwood Park, Deer Park, and Casa Loma, saw the largest surge in home prices in June at almost 24 per cent month-over-month with the average sale price rising to more than $2.1 million in June from $1.7 million in May. Prices were also up by almost 24 per cent year-over-year.
The share of detached homes sales in the area was much higher in June than May, which was one reason for the surge, said Jason Mercer, vice-president and senior analyst of TRREB.
“This means that a greater share of much more expensive homes (relative to condo apartments) contributed to the overall average,” he said.
But the influx of new luxury apartments in premium midrise buildings is also attracting potential buyers.
According to TRREB, condo apartment prices increased by more than 14 per cent from May to June.
“These are new boutique apartments and are at a premium price compared to other districts,” said Cailey Heaps, CEO and broker of record at The Heaps Estrin Team.
St. Andrews—Bridle Path—York Mills
In the St. Andrews—Bridle Path—York Mills area, TRREB reported almost a 30 per cent drop in the average home price from May to June, from $3.1 million to $2.2 million.
The region continues to take a hit after a 22 per cent drop from April to June, as prices are impacted by the federal government’s ban on foreign homebuyers, which is a significant factor in areas such as the Bridle Path. And buyers in the area are looking for long-term investments, real estate experts say.
“The type of buyer in the Bridle Path is more affluent and can take their time looking and selling their property,” said Forbes. “There’s no rush, meaning there’s fewer sales.”
In May, there were 29 sales and in June there were 18 — a 37.9 per cent drop. And home prices year-over-year didn’t fair much better at a 28.2 per cent decline.
Lawrence West, which includes Bedford Park, Lawrence Manor, North Toronto, Forest Hill North, and Lawrence Park, saw a decrease of 6.95 per cent in average prices month-over-month from $2.5 million in May to almost $2.4 million in June.
Heaps said while the volume of sales was down significantly — there were 81 sales in May and just 54 in June or a 33.3 per cent drop — the average price was not drastically different and was in line with the general downward shift the city experienced last month. While prices were down in June, year-over-year the area saw a four per cent increase.
In addition, there is typically a market slowdown in June as travel in summertime contributes to homebuyers and sellers being less active, especially in family homes, she added.
Vaughan and Brampton
The city’s suburban regions such as Vaughan and Brampton saw similar price declines month-over-month, at 5.7 per cent and 7.2 per cent respectively.
In Brampton, the average sale price dropped from $1.14 million in May to $1.06 million in June. In Vaughan, the price fell from $1.4 million in May to $1.3 million in June.
“In regions like Brampton you have more long-term family homes, which people will stay in for longer,” said Wins Lai, a Toronto real estate agent. “So, we will see that inventory is staying on the market for longer because people are less likely to move out of the neighbourhood with the interest rate hikes.”
During the pandemic both regions also saw an influx of prospective buyers looking to acquire more space with better access to nature, which drastically ratcheted up prices in the suburbs.
But now that more people are returning to Toronto’s downtown, those artificially high prices are continuing to cool down, Heaps added.
“Suburban markets like Vaughan and Brampton feel a sharper decline as inventory was prolific there,” she said.
Still, Vaughan saw a 0.5 per cent year-over-year home price increase and Brampton saw five per cent.
“Prices are still higher in June this year compared to last,” said Yolevski.
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