oronto residents Stephen and Melissa Heidebrecht have done the math and they're moving on — to Kitchener.
After two years of scouring Realtor.ca, squeezing through open-house crowds and watching homes they'd love to live in go for $100,000 or more over the asking price, they've thrown in the towel on Toronto.
Last month, the Heidebrechts put their 1,500-square-foot, two-bedroom bungalow in east-end Little India up for sale for $599,900. A four-person bidding war later, it sold for $706,000.
They move into their $482,500 home in Kitchener's Forest Hill area in July. It's a four-bedroom, more than 3,000-square-foot detached house on a quiet cul-de-sac they liken to Scarborough's Guildwood.
Their Toronto home would pretty much fit into the double-car garage.
While Heidebrecht, an engineer and self-employed contractor, will have to restart his business in a brand new city, the couple, both 35, figure the price is worth it: Overnight their mortgage will plummet from $200,000 to just $20,000. Melissa, an occupational therapist, will have the option of staying home with their two boys, Jacob, 6, and Wally, 2.
"Do you know how many times I have cried, thinking that I'm being forced out of my home by the fact that the market here is insane?" says Melissa, who is keen on the much-debated move, but concerned about leaving good friends, the children's babysitter and even nearby parks where the boys go swimming in summer.
"We couldn't even afford to buy our own house at this point. It's almost like someone has stolen something from you — like the market has stolen your ability to live here."
In reality, it has.
Last month the average sale price of a resale detached house in the City of Toronto hit $1.15 million, up 18.2 per cent from May of 2014.
And a recent report by the Canada Mortgage and Housing Corp. warned that construction of new, single-detached homes will continue to decline — and prices climb — because of land costs, lack of serviced subdivisions and land use policies, which is code for intensification and the shift to highrise rather than low-rise housing construction.
That means it's going to become ever harder to buy a detached home in the Greater Toronto Area, unless you can afford to pay $2 million for brand-new infill houses in Toronto, or are willing to move to the easterly 905 regions, Hamilton, Barrie and Waterloo Region, the housing authority noted.
"If we could have moved up to a bigger house for $50,000, we might have considered staying in the city," says Stephen. "But then we realized we were looking at more like $200,000, which would have doubled our monthly payments. I don't want to be married to my mortgage until the day I die."
Toronto real estate refugees have long been leaving the city for surrounding areas like Barrie and, more recently, Hamilton and Waterloo Region.
But even more far-flung areas like Bowmanville and Courtice in the easterly Clarington area now are seeing bidding wars as the demand for affordable houses — detached, semis or townhomes — outstrips supply in large parts of Oshawa, Whitby, Pickering and Ajax and pushes house hunters farther east.
Also driving demand to the east — as well as westerly cities like Hamilton and Kitchener — are promises of more frequent GO Train service. Added to that, in the easterly extremes of the Toronto area, is the coming Highway 407 extension which promises to ease the daily, if costly, commute to jobs in the city.
"We're seeing more bidding wars and houses going for over asking price," says Bowmanville-area realtor Kim Downey who recently listed her own Whitby home for $399,000. She had seven offers and the house went for $40,000 over asking price.
"For the last few months, almost every listing out here has been holding back offers," says Downey, a tactic that is seen as driving up competition in the city by listing a house one day and not accepting offers for a week.
"It's become the norm. Supply is tight and demand is huge. Prices here are still good compared to the west end of the (Greater Toronto Area), but I think they are going to catch up."
News services
No comments:
Post a Comment