Toronto Real Estate and Homes For Sale

Housing Market Goes on Roller Coaster Ride in Toronto

Some of Toronto’s prime neighbourhoods do indeed march to the beat of a different drummer. Between May 2008 and August 2008, home sales in Lawrence Park and Leaside went down by 13% and 29% respectively, compared to the same time period in 2007.
However, once again the average sale price managed to go up in both these neighborhoods in the same time period. It would appear that buyers in these two Toronto neighbourhoods have a much different view of the future of the real estate market.

In Leaside the average sale price of homes rose by 7%, while in Lawrence Park prices went up by 22%. Strangely enough, Davisville Village located besides these two neighbourhoods, also had home sales go up 1%. However, the average sale price of homes decline by 5%.

Talk about all real estate markets being local! Davisville Village and Leaside are separated only by Bayview Avenue. I would love to know if economists have coined a new term for such contradictory market conditions, such as “confused housing syndrome”. 

Why is it that home sale prices are still going up in Leaside and Lawrence Park?

In talking to a mortgage broker who handles a high volume of loans for buyers in these two neighbourhoods, he said that buyers often qualify for up to 50 per cent more than the amount of the loan for which they are applying. This partially explains why many Leaside and Lawrence Park home sellers continue to receive offers above the asking price, at a time when the Greater Toronto housing market is showing a decline in both the number of homes sold and the average sale price.

To my knowledge, these two Toronto neighbourhoods are unique in Canada.I have currently not found anything of a similar nature happening in any market, where sales are going down but prices continue to go up.

Proceed with caution
We are not out of the woods yet. With all the talk about the Chinese boom, Japan is still the second largest economy in the world, behind that of the U.S. A. Yesterday two more large Japanese home builders filed for bankruptcy, following a long list of housing developers that have sunk in the past year. It is wise for you to exercise caution and not think that our economy is immune to developments in the rest of the world.

Buying a home has become a much more complex issue, especially in central Toronto.

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This entry was posted on Wednesday, August 27th, 2008 at 5:31 pm and is filed under Tips for Buyers, Tips for Sellers, Toronto Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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