House sales across the GTA may be dropping but prices are staying flat, according to the Toronto Regional Real Estate Board’s (TRREB) latest forecast which indicates that affordability remains an ongoing challenge in the market. 

There were 5,627 home sales in Toronto this August – a 34.2% drop since the same period last year. Prices, on the other hand, barely moved. The average selling price for all types of homes rose just 0.9% from August 2021 to $1,079,500.

What’s behind the trend?

The TRREB forecast paints an uncertain picture. Prices may be relatively stable, but sales are clearly slumping, why?

With inflation soaring, high borrowing costs are dampening buyer enthusiasm. The Bank of Canada spent the first half of the year aggressively raising interest rates and appears to be continuing the trend, announcing yet another hike this week, the fifth in 2022.

In light of these financial constraints, the TRREB makes the case for abandoning the mortgage stress test.

President Kevin Crigger said: “There is room for the federal government to provide for greater housing affordability for existing homeowners by removing the stress test when existing mortgages are switched to a new lender, allowing for greater competition in the mortgage market. Further, allowing for longer amortization periods on mortgage renewals would assist current homeowners in an inflationary environment where everyday costs have risen dramatically.”

What does this mean for GTA landlords?

If you have the means to dive into the market, this is a good time to buy. Prospective property investors holding off in expectation of a price plummet will likely be disappointed as there’s nothing to suggest that prices will drop any time soon. But they do appear to be holding steady.

Sit back and wait for the perfect property at the perfect price and you could be losing out on rental income. Especially given the fierce demand in the Toronto market for affordable rentals.

If you’re intimidated at the prospect of becoming a landlord, why not let the experts handle all your property needs. Property managers give landlords peace of mind, taking on not just the daily operations but also all the stressful jobs like tenant disputes, maintenance, and urgent repairs.

The highly-experienced team at Highgate Property Management have been helping Toronto landlords make the most of their properties for over 30 years. Our extensive range of services include tenant screening, rent collection, renovations, maintenance, and more. Let us do the hard work of renting so you can enjoy your income without any headaches or hassles. Contact our team today!