With all the recent shocks and surges of Toronto’s real estate market, it’s no wonder cautious investors have been sitting on the sidelines, waiting to make their move.

As property peaked to record prices across the GTA, prospective landlords found themselves rethinking their investments, at least until the market cooled.

And now it has. 

The formerly scorching market is now a more inviting temperature, according to national bank BMO, which is optimistically predicting a buyer’s market in the near future.

GTA real estate evens out

BMO’s bright forecast stems from a sudden drop in the GTA sales-to-new-listing ratio, which has dipped from around 70%  to 45%, becoming more in line with post-pandemic figures. 

This important metric is a reliable market indicator as it compares home sales with listings, or supply with demand. When listings wane and sales increase, the balance of power shifts from sellers to buyers. 

The latest report from the Canadian Real Estate Association (CREA) provides more evidence of this shift, showing that sales dipped 12.6% in April whereas new listings had a gentler drop of just 2.2%.

Commenting on the report, CREA Chair Jill Oudil said: “Following a record-breaking couple of years, housing markets in many parts of Canada have cooled off pretty sharply over the last two months, in line with a jump in interest rates and buyer fatigue. For buyers, this slowdown could mean more time to consider options in the market.”

Don’t wait, buy it!

Even in a hot market, Toronto landlords can make a profit. Waiting for the right time to buy a rental isn’t always the best strategy. Diving into a seller’s market may mean a higher purchase price, but savvy landlords can recoup their investment by collecting passive income from their rental and even setting higher rents where appropriate.

If you have been waiting it out hoping for more palatable prices, now’s the time to strike. According to BMO, prices are set to stall and with the Bank of Canada upping interest rates to combat soaring inflation, it’s likely the market will dampen further.

Against a backdrop of falling demand and lowered prices, GTA property investors are finally back on top. This is the first window of opportunity since the pandemic began so whether you’re a first-time landlord or adding to your property portfolio, don’t wait to take advantage of it. Invest now and you’ll enjoy a reliable source of passive income that could see you through whatever the market does next.

If you’re new to the rental market, or just too busy to monitor your investment, consider a property management service. Highgate Property Management doesn’t just maintain and manage homes, it also provides a full suite of rental services including tenant screening, on-call maintenance, and tenant management.  

We act as your representative so you never have to deal with disputes, maintenance issues, or rent collection. Our experienced and professional team take the stress out of property ownership so you can relax and enjoy the extra income worry-free. Contact us today to find out more.