Looking to break into the Toronto real estate market, but seek more square footage than the typical condo provides? Given the average house price now tops $1.3 million in the city, according to the Toronto Real Estate Board, you better have a significant nest egg if you dream of detached living.
Average Toronto Income Comes Up Short
When it comes to homebuyer affordability, the numbers can be daunting. Let’s say a borrower earns the median Toronto household income of $76,219, pays at least 20% down on their home purchase, and qualifies for a 2% variable-rate mortgage with a 30-year amortization. Even in this best-case scenario, they’d still only be granted $636,886 in affordability by their lender. That amounts to precious little in a market where bidding wars are the norm and homes increasingly sell for hundreds of thousands of dollars over asking.
Searching Beyond City Borders
Many buyers who find themselves priced out of the market “drive until they quality”; they’ll buy a house in a further-flung GTA community – TREB reports the average home can be found there for $795,569 – and brace for a daily car or train commute. But suburb life isn’t for everyone. And, while raising a family in a high-rise is becoming a more common tactic (developers are even creating larger units to meet demand), it’s not an ideal situation for all.
Townhomes: The New Toronto Real Estate Reality
For buyers who wish to remain in the city but need more space, townhomes are quickly becoming the new low-rise standard. According to MLS townhouse and detached house sold numbers compiled by Zoocasa, the average detached home price skyrocketed a whopping 83.% from 2011 to 2016. By comparison, townhome prices surged only 53.3%, to an average of $562,187 – still within the realm of affordability for many Toronto buyers.
To help home buyers on their home search, Zoocasa has identified the top 20 most affordable neighbourhoods for Toronto townhomes, along with change in demand, and average time on the market. Check out the infographic below to find a townhouse option in your price range.
By: Penelope Graham, Zoocasa
Penelope Graham is the Managing Editor of Zoocasa.com, a leading real estate resource that uses full brokerage service and online tools to empower Canadians to buy or sell their home faster, easier, and more successfully.