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June Home Prices Hit New Territory

The Toronto Real Estate Board has reported the “best June on record” with sales activity up 27% over last year. Market pressure has caused prices to jump back into new territory for the first time in 14 months. Rising home prices in the midst of a recession, you say? How can that be?
3 lessons arise from the real estate boom market we have experienced in the GTA over the past five months.
 1. With an average sale price of $403,972, Toronto Real Estate prices have returned to previously unreached heights. Prices have skyrocketed this year by over $60,000 from a low of $343,632 in February to the current level. This jump of almost 18% in just five months gives a clear message… buyers have continued to take advantage of the amazingly low interest rates currently offered. They have also often found themselves in multiple offer scenarios, bidding against buyers of a similar mindset… and rising home prices have been the result. The message is obvious… mortgage money at currently available rates has been simply too good a deal to pass by. And first-time buyers, without whom the market grinds to an inevitable halt, have been sufficiently encouraged by low cost factors to come into the market in droves. 

2. While this market has been welcomed by sellers, it has often been hard on the very buyers who have created it. We heard of one buyer this year that placed offers on eight houses before they managed to “win” a bidding competition and got a house they wanted. Some have found it difficult to want to engage in such challenges in the midst of an economic recession. Not only has it been frustrating for such buyers, but it takes a lot of time and work for their agents, too. However, being able to purchase a $400,000 house for lower payments than a $300,000 home may have required just a short while ago has obviously been worthwhile in the minds of many.
3. Federal government intent to drive the economy by making inexpensive credit available has worked, and every real estate sale brings in thousands of dollars in taxes to give the governments the money to work with on both a federal and provincial level. In Toronto, the city claims its own land transfer tax, too. The fundamental appeal of real estate at affordable carrying costs has been a major factor in helping to mitigate the effects of the recession.
 Thinking of moving? For first-timers these interest rates are awfully hard to turn down. And for present home owners, it’s a great time to be moving up. And if you are moving out for the last time, it’s not a bad time to be doing that either.

 

 

 

AVG Monthly Selling to Dec 2009

 
 
Keller Williams Real Estate Associates.
BUS 905-812-8123
FAX 905-812-8155 DIRECT 905-785-7282
E-MAIL : mailto:gail@gailsellshouses.com?subject=Mississauga
Website : www.gailsellshouses.com
 Thinking of selling your home in the next 3 to 6 months? Would you like a Complimentary & Over-The-Internet Home Evaluation
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