According to Statistics Canada's report on Tuesday, Canada witnessed a deceleration in its inflation rate to 3.4 percent in the year leading up to May. This slowdown can be attributed to notably lower prices of gasoline. In April, the inflation rate stood at 4.4 percent, making the current decrease quite significant.

The primary factor driving this deceleration is the decrease in gasoline prices. If we exclude the impact of gasoline, the inflation rate would remain at 4.4 percent. The average decline of over 18 percent in gasoline prices compared to their peak levels last year has played a major role in dragging down the overall inflation rate on its own.

However, despite the apparent deceleration in consumer prices, various aspects of the cost of living continue to rise significantly.

The rate at which grocery prices are increasing is nearly nine percent, only slightly lower than the 9.1 percent rate observed in April. Moreover, this rate is nearly three times higher than the overall inflation rate.

Food prices have consistently been on the rise at a faster pace than the officially reported inflation rate for over a year now.

Moreover, the expense associated with maintaining a place to live continues to surge at an alarming rate.

The mortgage interest cost index has soared by 29.9 percent, marking the highest pace ever recorded. This escalation is a result of the Bank of Canada's aggressive increase in lending rates, aimed at dampening demand.

Variable rate mortgage holders have been particularly impacted, as the cost of servicing their loans has been skyrocketing throughout the year. Even those with fixed-rate loans are facing the need to renew and secure new loans at substantially higher rates than their previous ones.

The increased cost of mortgages stands as the primary factor influencing the inflation rate, according to the data agency. If mortgage expenses are excluded from the calculations, Canada's headline inflation rate would have been 2.5 percent, down from 3.7 percent in April.

Leslie Preston, an economist at TD Bank, pointed out that even if we exclude volatile factors such as gasoline and mortgages, the underlying inflation remains at a level that would likely lead the Bank of Canada to consider another rate hike in the future.

"While the decrease in goods inflation is positive, it is likely that the Bank of Canada has already taken that into account as supply chain disruptions ease," she explained. "Although Canadian inflation has continued to moderate in May, it is unlikely that the progress made will be sufficient to deter the Bank of Canada from implementing rate increases in July."

Navigating the ever dreaded LOWBALL OFFER When Selling Your Home

Opinions vary regarding the definition of a "lowball offer." Some individuals consider it as an offer substantially below the listed price, while others perceive it as an offer significantly below the market value. In this blog, we will refer to "lowball offers" as those that are considerably below the asking price or below market value.

Receiving lowball offers can be disheartening but it is possible to handle them effectively. Here, we provide our top recommendations:

Understanding the Buyer’s Motivations

Gaining Insight into the Buyer's Intentions Before Responding to a Lowball Offer

When faced with a lowball offer, it is essential to comprehend the motivations driving the buyer. Typically, lowball offers originate from buyers in the following situations:

1. Bargain hunters: Some opportunistic buyers or investors are actively seeking a favorable deal and aim to purchase a property below its market value. They employ lowball offers as a strategy to identify sellers in desperate circumstances.

2. Budget limitations: Occasionally, buyers develop a strong affinity for a property that surpasses their financial capabilities. Although they may recognize the value of your home, their budget restricts them. As a result, they may submit an offer lower than your asking price, hoping for a fortunate outcome.

3. Renovation plans: Surprisingly common, certain buyers intend to renovate the property and deduct their estimated renovation expenses from the asking price. They may fall in love with a house but perceive the need to replace the kitchen and bathrooms, resulting in an offer lower than the listed price. It is important to note that personal renovation plans do not directly influence a property's market value.

4. Negotiation tactics: Some buyers, and their agents, relish the art of negotiation and utilize lowball offers as a means to shift the dynamics of the negotiation process. While their true intention might be to pay the market value, they engage in protracted negotiations as part of their strategy.

5. Lack of knowledge: Many buyers rely on their real estate agents to assist them in comprehending a property's value. Regrettably, not all agents possess extensive experience in property valuation. There have been instances where ill-informed agents have advised buyers to submit offers significantly below the asking price, leading to disappointment and frustration for both parties involved.

6. Genuine concerns about property value: While you may not necessarily agree with their perspective, some buyers may genuinely believe that your home is worth considerably less than your listed price. They may have reservations regarding its value, which drives them to present a lowball offer.

By understanding the motivations behind the buyer's offer, you can engage in more effective negotiations and potentially increase the chances of a successful sale.

Are You Priced Right?

Do you have substantial comparable sales data, indicating nearby properties with similar characteristics that support your asking price? Have you taken into account the prevailing market conditions?

HOMEBUYERS today are SMART! – they can quickly identify an overpriced residence, just as readily as they can recognize an underpriced one. If you're selling your home and have received numerous lowball offers, it may indicate that your price is set too high.

Don’t Take it Personally

While receiving a lowball offer can feel personal, it's crucial to keep in mind that buyers are primarily focused on securing the best possible deal for themselves. I've witnessed sellers react emotionally to such offers, refusing to engage in negotiations—I've even found myself in that position. However, if you can prevent yourself from becoming defensive, you'll enhance your likelihood of achieving a successful outcome.

Counteroffer with a Realistic Price

When faced with a lowball offer, it is crucial to respond with a counteroffer that reflects a realistic price. Take into account the present market conditions, recent comparable sales in the vicinity, and any improvements or renovations you have made to the property. Your counteroffer should be grounded in objective factors rather than emotions or a desire to retaliate against the buyer. Just because the buyer may be engaging in strategic maneuvers, there is no obligation for you to follow suit.

Be Willing to Walk Away

If the buyer demonstrates an unwillingness to engage in negotiations and presents an unfair price, you might need to consider withdrawing from the transaction. Certain individuals who submit lowball offers are solely seeking an advantageous deal and may never intend to pay the property's market value.

The Office of the Superintendent of Financial Institutions (OSFI) in Canada announced on Tuesday that it would raise the stability buffer for the country's major banks by 50 basis points to 3.5%. The decision, set to take effect on November 1, was made in response to increasing borrowing costs, high levels of debt, and pressures on the financial system.

In its statement, the OSFI expressed concerns about elevated household and corporate debt levels, the escalating cost of borrowing, and heightened global uncertainty surrounding fiscal and monetary policies. With the financial sector demonstrating resilience in recent quarters, the OSFI deemed it an opportune time to take action.

Superintendent of Financial Institutions Peter Routledge stated, "We are implementing measures to strengthen the resilience of Canada's largest banks against vulnerabilities." The regulator's action comes amid growing concerns about the ability of Canadians to manage their debts, with rising worries about potential increases in delinquency rates for mortgage payments.

Anticipating economic challenges and consumers' struggles to make payments, major banks have already allocated additional funds.

According to Desjardins analyst Royce Mendes, the purpose of the higher buffer is to provide extra capital as a safeguard for future uncertainties.

The cautious approach taken by both regulators and the regulated institutions is expected to enhance global investors' confidence in the stability of the Canadian financial system.

The stability buffer, established in 2018 to bolster banks' capital resilience against vulnerabilities, is reviewed semiannually but can be adjusted at other times.

The common equity tier 1 ratio for Canada's top six banks will now rise to 11.5%, up from 11%. This ratio compares a bank's capital with its risk-weighted assets and measures its ability to withstand economic downturns.

As of the end of the first quarter, the ratio for the six largest banks ranged between 11.9% and 15.3%, with most banks targeting a 12% ratio by the end of 2023.

This marks the second consecutive increase in the size of the buffer by the OSFI. In December of the previous year, it raised the buffer by 50 basis points to 3.0%. The buffer had been lowered during the pandemic but has been raised in the past two years.

One of the most common questions homebuyers ask us is “when is a good time to buy a house?” There isn’t one good answer, because there are so many factors that go into your decision to buy a house. You can’t always time the real estate market to line up with your personal life, such as if you’re downsizing, upsizing, getting married, getting divorced, having a child, or going through any other major milestone that is leading you to look into buying a house.

If you’re getting ready to buy a house, here are some reasons why it might be a good time to buy a house.

YOU NEED TO UPSIZE BEFORE YOU COMPLETELY OUTGROW YOUR HOME

Making do in a house that’s too small will only work for so long. If you’re expecting a new family member, either because you’re about to have a baby, adopt a child, or have a family member move in permanently, then it’s a good idea to upsize before the change happens. This will give you time to buy a new home, sell your old home, and settle in before making another major transition.

YOU HAVE TO DOWNSIZE IN A HURRY

Whether your adult kids have moved out, you’re dealing with the death of a close family member, or you just got divorced, you might need to downsize suddenly. Because you’ll tend to save money by buying a smaller home, you don’t necessarily need to worry about timing a downsize with the market. If you have too much house and need to get into a smaller space, you should do so when you’re ready instead of hanging on to the burden of maintaining a large house when you don’t have the time or money to do so.

YOUR FAMILY NEEDS TIME TO TRANSITION

One reason summer is so popular for moving is because it gives families time to settle in to their new neighborhoods before school starts. This is especially important if you’re moving to a new school district. It’s hard enough to pull kids away from their familiar friends, teachers, and routine. If transitioning during the summer instead of pulling them out mid-year works for your family, then that’s what you should do.

No matter what’s motivating you to buy a house, whether it’s your first house or your fifth, you should start with timing it based on your life. There will always be houses on the market, so focusing on when it makes sense for you to move instead of when it’s the best time to move based on the market might be what works best for you and your family.

‍Book a discovery call with us here

‍

The Bank of Canada (BoC) caused a surprise in financial markets by increasing its policy rate by an additional 0.25% during the previous week. As a result, Canadian homeowners who possess variable-rate mortgages and/or home-equity lines-of-credit will experience a corresponding rise in their interest rates in the near future.

Bond-market investors had anticipated an increase in the Bank of Canada's policy rate at its upcoming meeting scheduled for July. However, the Bank chose not to wait until then and surprised the market.

In its policy statement, the Bank concluded that "monetary policy was not sufficiently restrictive." The following day, BoC Deputy Governor Paul Beaudry justified the decision by explaining that "excess demand in the Canadian economy is more persistent than we thought, and it increases the risk of the decline of inflation could stall."

Although the Bank had always kept the option open for further rate hikes if deemed necessary, the timing of their recent action and the rationale behind it left many market observers bewildered.

In January, the BoC said that it would take “an accumulation of evidence” to move it off the sidelines. In the end, it moved after only two policy-rate meetings.

The Bank is focusing on four key elements: 1) the evolution of excess demand, 2) inflation expectations, 3) wage growth and 4) corporate pricing behaviour.

1) EXCESS DEMAND - The Bank of Canada (BoC) noted that demand was unexpectedly robust and widespread. However, it did not explicitly acknowledge that a substantial portion of this additional demand can be attributed to the rapid depletion of savings accumulated during the pandemic. This temporary surge in demand is projected to diminish later this year, well before the effects of last week's rate hike become significant. It's important to note that rate hikes typically take effect with a delay and have an impact that lasts for approximately two years.

2) INFLATION EXPECTATION- The inflation expectations of both consumers and businesses continue to remain high, and this sentiment was not alleviated by the announcement that our Consumer Price Index (CPI) increased from 4.3% in March to 4.4% in April. It is possible that the Bank possesses information that is not yet available to the public. Although the most recent consumer and business expectation surveys are set to be released in July, Stephen Brown, Deputy Chief Economist at Capital Economics, confirmed that the Bank already has access to those findings (more details on this matter will be provided later in this post).

3) WAGE GROWTH - The overall nominal wage growth continues to maintain a pace of approximately 5% on an annualized basis. However, the Bank of Canada (BoC) has cautioned that unless there is a significant increase in productivity (which has been declining steadily), inflation will persist above the target level. On the other hand, real wage growth, which considers inflation's impact on nominal wage growth, remains below 1% and is still lower than pre-pandemic levels. Consequently, the average worker's purchasing power is barely improving. In other words, wage growth is unable to generate substantial excess demand. Additionally, there are indications that employment momentum is slowing. Job vacancies have been steadily decreasing over the past two quarters, labor force growth is surpassing the rate of hiring, and most recently, it was revealed that an estimated 17,200 jobs were lost in May. These factors collectively suggest an impending deceleration in wage growth.

4) CORPORATE PRICING BEHAVIOUR - Businesses tend to set prices based on market conditions, but it is primarily the limited savings buffer mentioned earlier that has enabled consumers to withstand higher prices without reducing their spending. However, this buffer is diminishing rapidly. As demand declines, profit margins will shrink rapidly, as there is less consumer spending to go around.

If the Bank of Canada (BoC) is expected to anticipate future trends when setting its monetary policy, why is it relying on indicators that reflect past conditions to justify another round of tightening, which will only have a significant impact a year or two from now?

I believe the decision to raise interest rates is driven by two crucial and interrelated objectives: 1) to manage inflation expectations and 2) to slow down the upward momentum of real estate prices.

Although inflation only rose slightly from 4.3% in March to 4.4% in April, it marked the first month-over-month increase since inflation reached its peak in June 2022. Many people may not delve deeper into the news beyond the headlines announcing the resurgence of inflation.

Implementing another rate hike attracts attention and helps to anchor inflation expectations.

More significantly in the current context, last week's rate hike will also dampen the momentum of our recently revived real estate markets. The Bank likely wanted to take action without further delay.

Real estate was expected to cool down for a period after the Bank of Canada implemented its most substantial series of rate hikes in modern history. However, the Bank's decision to pause in January unexpectedly fueled the market. When buyers learned that interest rates would no longer increase, they reentered the market, leading to excessive demand for limited housing supply.

Subsequently, the US banking crisis triggered a significant drop in bond yields, which in turn caused fixed mortgage rates to decline by 0.50% or more. Bidding wars resurfaced, and prices began to rise once again.

In its policy statement, the Bank of Canada acknowledged that "buyers were returning to the housing market, despite tight supply," and noted the "unexpected" strength in goods spending, particularly the demand for interest-rate-sensitive goods such as furniture and appliances, which are closely linked to home purchases.

The strong rebound in the real estate market significantly influences consumer inflation expectations, according to economist Stephen Brown, who recently highlighted the Bank's research indicating a strong correlation between house prices and consumer inflation expectations.

While the Bank's most recent rate hike did lead to a 0.25% increase in variable mortgage rates, the greatest impact was seen in fixed rates, which is the preferred choice for most borrowers nowadays. In a short span, three-, four-, and five-year fixed rates have surged by 0.50% or more, approaching their previous cycle peaks. Currently, this aligns with the Bank of Canada's intentions.

The favorable conditions resulting from the US banking crisis have now completely dissipated, with any expectations of rate cuts forgotten. Prospective homebuyers are once again concerned about the potential increase in near-term mortgage rates.

From the perspective of the Bank of Canada, their mission is accomplished for now.

So, what should you do if you are in the market for a mortgage today?

When the US banking crisis led to a decline in our bond yields, it created advantages for new borrowers opting for fixed rates, but it came at the expense of existing variable-rate borrowers. Lower fixed rates undermined the Bank's efforts to slow demand and consequently delayed the implementation of variable-rate cuts.

Fixed rates have become increasingly favorable for several reasons.

These rates are based on bond yields that had previously factored in the expectation of policy rate cuts by the Bank of Canada (BoC) and the Federal Reserve in the upcoming fall, despite BoC Governor Macklem publicly dismissing such a notion. Those who secured a fixed rate during a period when the bond market anticipated near-term rate cuts are currently benefiting from their decision.

Present-day fixed mortgage rates now reflect a viewpoint of prolonged higher rates. Currently, the bond market has aligned with the BoC's perspective.

Interestingly, each rate hike by the BoC increases the risk of excessive tightening. This raises the likelihood that, when economic slowdown accumulates and prompts a reversal in policy, the Bank may need to implement rate cuts sooner and more aggressively than it otherwise would have. Although this argument holds theoretical validity, it may be challenging for borrowers to let it significantly impact their decision-making, especially considering that variable rates are even higher now and the bond market believes additional rate hikes are not just possible but likely.

For the time being, I maintain the belief that the safest choice for individuals currently seeking a mortgage and aiming for a balanced approach is a three-year fixed rate.

Those who opt for this choice must accept the risk of potentially paying an above-market rate in the later part of their term. However, most borrowers view this as a trade-off worth making when the alternatives are longer terms (which amplify the risk) or variable rates and shorter-term fixed rates (which appear to be consistently rising).

The main point is that the increase in Government of Canada (GoC) bond yields led to lenders raising their fixed mortgage rates once again.

The recent surge in GoC bond yields suggests an expectation that the Bank of Canada (BoC) will likely increase its policy rates before the end of the year. Consequently, there may be a possibility of a near-term pullback following such a significant movement. This could result in fixed mortgage rates remaining stable at their new elevated levels for the foreseeable future.

Variable-rate discounts remained unchanged last week. However, the unexpected 0.25% hike by the BoC last Wednesday means that borrowers with variable rates will soon experience a corresponding increase in their borrowing costs.

Assisting your elderly parents in preparing to sell their house can pose challenges, particularly considering the physical and emotional strains they may face. Yet, with patience, effective organization, and unwavering support, you can facilitate a seamless and stress-free experience for them. Here are a few helpful tips to aid you in helping your parents prepare for the sale of their house:

Initiate a conversation with your parents regarding their motivations for selling their home, and make sure to genuinely LISTEN to their thoughts and concerns.

Gaining a clear understanding of your parents' motivations for selling their home is crucial in providing them with appropriate support. Are they seeking to downsize, relocate closer to family, or simply seeking a change of environment? Could new health considerations or accessibility requirements be driving their decision? Is there a shifting financial situation prompting the desire to sell? Although these conversations may become awkward or uncomfortable, and your parents may not readily disclose all the details, having insight into their true motivations will enable you to adapt your approach accordingly.

Ask them how they picture the process, you can gain valuable insights into their preferences and requirements. This will allow you to align your support with their desires and provide assistance tailored to their unique circumstances.

Anticipate that the sale, even if it doesn't involve the family home, will likely evoke strong emotions. Choosing to downsize or move to a permanent residence can be both thrilling and daunting, particularly when driven by health concerns or the fear of aging and diminished independence. It's crucial to understand how your parents envision the sale process. Are they interested in actively participating in the details, or would they prefer you to handle it on their behalf? Determine their preferred timing for the sale and the reasons behind it. Do they wish to remain in the home while it's listed, or would they prefer to relocate beforehand? Consider their needs, desires, and expectations from you. Additionally, discuss whether they would like other friends or family members to be involved in the sale and clarify their roles if applicable. By addressing these questions, you can better support your parents and ensure a smoother transition.

Assist them in decluttering, preparing, and staging the house.

Assisting your parents in decluttering and preparing their house can be a daunting task, especially for seniors. Offer your support by helping them sort through their belongings and assist in donating or selling items they no longer need. Additionally, you can contribute to staging the house by reorganizing furniture, decluttering surfaces, and adding simple embellishments like fresh flowers and scented candles to create a more inviting atmosphere.

Alternatively, consider involving a trusted REALTOR early in the process to streamline the house preparation and minimize stress. Reputable real estate agents have extensive networks and access to professional resources that can expedite the home-selling process. In fact, certain real estate teams in Toronto, including ours, provide in-house staging and design services as part of their commission. Remember, you don't have to tackle everything on your own, and it can be helpful to have a professional communicate any necessary changes, such as informing your mom that her cherished dining table may be too large for the room.

Assist with maintance tasks and minor repairs

Prior to selling their house, your parents may find it necessary to address minor repairs and maintenance tasks. These can range from fixing leaky faucets and painting walls to replacing broken tiles or addressing any other issues that may affect the overall condition and appeal of the property. Show your support by offering to assist with these tasks or arranging for professional help if required. By ensuring that necessary repairs and maintenance are taken care of, you can help your parents present their house in the best possible light to potential buyers.

Help them find the right real estate brokers

Finding the ideal real estate agent to assist your aging parents in selling their home can feel overwhelming. Given that your parents may not have sold a property in decades, or possibly ever, they might be surprised by the changes in the process. You can ease their burden by helping them select a reliable REALTOR. Start by conducting online research, reading reviews, and seeking recommendations from friends. Additionally, offer your assistance in reaching out to agents and participating in the interview process. Look for a REALTOR who specializes in working with seniors and comprehends their specific requirements. It's crucial to find someone who offers the essential services that align with your parents' needs and who respects and connects with all parties involved in the sale.

Help them navigate the paperwork, technology and legalities

Selling a house involves a significant amount of paperwork and legal procedures, which can be overwhelming for anyone, particularly seniors. While it's the responsibility of the REALTOR to ensure that your parents understand the sales process and the legal documents they are signing, don't hesitate to step in and request clarification or repetition from the agent if needed. If your parents feel too intimidated to ask questions themselves, be proactive and inquire on their behalf. Additionally, it's worth noting that many agents utilize electronic signatures for document signing, which may be intimidating or challenging for older individuals. Take the initiative to discuss any technology requirements during the sale process and inquire about alternative options available to accommodate their needs.

Support your parents

When deciding between purchasing a condo or a house, the choice ultimately boils down to factors such as cost, location, and lifestyle. In the following discussion, we examine the advantages and disadvantages of buying a condominium versus a standalone house.

Ongoing Costs

When you become a condominium owner, a significant portion of your maintenance expenses is covered by a monthly condominium maintenance fee. The specific inclusions of these fees vary between buildings, but it is not uncommon in the Greater Toronto Area (GTA) to encounter monthly fees ranging from $0.60 to $1.00 per square foot. While condo fees may give the impression of being costly, there are other expenses associated with owning a house that often go unnoticed. Here are some costs you can anticipate when purchasing a house:

1. Higher insurance costs: For a typical house, insurance expenses are typically around $100 to $150 per month, compared to $20 to $25 for a condo. Condos usually have insurance coverage for walls, roofs, and mechanical systems through the condo corporation.

2. Water and garbage: Owning a house involves additional costs for water and garbage, which can amount to an extra $600 to $900 per year. In contrast, condo fees often include these expenses.

3. Increased heating and electrical bills: Older houses tend to have higher heating and electrical costs, with most clients experiencing monthly expenses ranging from $200 to $400. Condo fees often cover these costs or provide significantly lower rates.

4. Maintenance: It is advisable to allocate 3-5% of the house's cost for ongoing maintenance, including tasks such as cleaning eavestroughs, ducts, furnace servicing, plumbing, and landscaping.

5. Significant unexpected costs: Even in fully renovated homes, unexpected expenses can arise, such as sewage backup, flooded basements, or leaky roofs, which can be financially burdensome.

6. Renovations: If you purchase a non-renovated house, you should be prepared for potentially larger and more expensive renovation projects compared to condos. Renovation costs can differ significantly due to upgrades in electrical, plumbing, roofing, as well as variations in size and age between condos and houses. It's wise to expect renovations to be twice as expensive as initially budgeted and take three times longer to complete.

For comparison purposes, a 1,000 sqft 2-bedroom condo typically has monthly fees ranging from $600 to $1,000, depending on whether utilities are included.

Location

The location of a property has a significant influence on its cost and the kind of lifestyle it offers. When deciding between a house and a condo, there are several factors to consider:

1. Commuting: Condos often occupy prime locations in the GTA, providing residents with convenient access to work and recreational activities, making commuting easier.

2. Affordability and Location: Generally, purchasing a condo is a more accessible entry point into the real estate market compared to buying a house. However, houses can still be affordable for first-time buyers if they consider moving outside the downtown core.

3. Schools: Residential areas where houses are more prevalent typically have a higher concentration of schools. If you have school-aged children, living in a house may make transportation to and from school more convenient.

4. Proximity to amenities: Some Toronto condos offer the convenience of having essential amenities right at your doorstep. From convenience stores, dry cleaners, LCBO (Liquor Control Board of Ontario) outlets to pet daycare centers, these services can be easily accessible. Consider how important convenience is to you and how much you are willing to pay or sacrifice for it.

When making a decision, it's crucial to evaluate how each option aligns with your preferences and priorities, taking into account factors such as commuting needs, affordability, proximity to schools, and convenience of nearby amenities.

Lifestyle - Houses vs Condos

Condominiums often offer a range of amenities, including fully equipped gyms, pools, big-screen theaters, party rooms, and even bowling alleys. While these amenities come at a cost through condo fees, if you make use of them, it can be a worthwhile investment.

On the other hand, owning a house provides a sense of freedom. You'll experience fewer, if any, neighbor-related issues and won't have to engage in small talk in an elevator. There are no rules and policies dictating the color of your curtains or where you can park your bike.

However, it's important to consider that owning a house requires both financial and time investments for maintenance. Tasks such as shoveling your driveway, mowing your lawn, and dealing with unexpected visitors like mice in your basement can take up your time and necessitate specific skills.

When deciding between a condo and a house, weigh the benefits of condo amenities against the freedom and reduced neighbor interactions of owning a house. Additionally, consider the maintenance responsibilities associated with owning a house and how they align with your preferences and available time.

The Alternative 

Deciding between purchasing a condo or a house is a significant choice, but there is also a middle ground to consider: townhouses. Townhouses offer a compromise between the two options as they can be legally structured as condominiums, where monthly maintenance fees apply, or as freehold properties, granting you full ownership, similar to a house.

Should you buy a house or condo?

When contemplating the choice between a condo or a house, consider your goals, budget, and envision the lifestyle you desire in your new home. Both condos and houses can serve as excellent investments in Toronto or around the GTA, so weigh your options carefully before making a decision.

At the Olivera Group, we are real estate agents that excel at helping our clients navigate the decision between purchasing a condo or a house. They begin by thoroughly understanding our client's needs, preferences, and long-term goals. We take into account factors such as location, budget, lifestyle, and future plans. With our in-depth knowledge of the real estate market, we provide valuable insights on the pros and cons of both options. By considering our client's financial situation, desired amenities, maintenance responsibilities, and personal preferences, we guide our clients towards making an informed choice that aligns with their unique circumstances. Our expertise and personalized approach empower clients to confidently select either a condo or a house that best suits their needs and ensures a successful investment our personal purchase. 

GTA REALTORS® Release May 2023 Stats

In May 2023, the housing market in the Greater Toronto Area (GTA) demonstrated continued improvement in terms of sales. However, the supply of available homes for sale failed to keep pace with the demand for ownership housing. The proportion of sales compared to new listings increased significantly compared to the previous year, indicating intensified competition among buyers. As a result, the average selling price rose to nearly $1.2 million last month.

Paul Baron, President of the Toronto Regional Real Estate Board (TRREB), expressed concern about the housing supply issue, noting that despite positive policy changes, governments have been falling short in this area for some time. Ipsos polling revealed that City of Toronto residents rated the Council poorly in terms of housing affordability and identified the lack of supply as a major problem. This issue extends beyond Toronto and persists throughout the Greater Golden Horseshoe region. If housing supply fails to catch up with population growth, it could impede the economic development of the region, leading people and businesses to seek alternatives elsewhere to reside and invest.

According to TRREB, GTA REALTORS® reported 9,012 sales via TRREB's MLS® System in May 2023, marking a 24.7 percent increase compared to May 2022. However, new listings decreased by 18.7 percent during the same period. When seasonally adjusted on a month-over-month basis, sales rose by 5.2 percent compared to April 2023.

TRREB Chief Market Analyst Jason Mercer highlighted that the demand for ownership housing has significantly risen in recent months. Many homebuyers have adjusted their housing preferences due to higher borrowing costs and are reentering the market. Additionally, robust rent growth and record population expansion resulting from immigration have also contributed to increased home sales. Insufficient listing supply relative to sales has led to upward pressure on selling prices during the spring season.

In May 2023, the MLS® Home Price Index (HPI) composite benchmark decreased by 6.9 percent compared to the previous year but increased by 3.2 percent on a seasonally adjusted monthly basis compared to April 2023. The average selling price was $1,196,101, representing a slight 1.2 percent decline compared to May 2022. However, on a seasonally adjusted monthly basis, the average selling price rose by 3.5 percent compared to April 2023.

As always, we are here to guide and educate all our clients, if you have any questions we are just a text, email or phone call away #yourhusbandwiferealtors @theoliveragroup