Best Time To Buy a Home in Toronto (2020)

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Best Time to buy a Home in Toronto
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Toronto home buyers, either investors or end users, usually ask me when is the best time to buy a home in Toronto?

All the years working with buyers in Toronto’s real estate as a Toronto real estate agent, I often have been asked this question from my clients. It’s important for home buyers to know when is the best time to purchase a house. To answer that question and many other questions that a buyer might have, we started educating the buyers before they enter the market.

An educated buyer can make the best decisions when purchasing one of their life’s biggest investments. With having that responsibility in mind, we designed crucial topics that a buyer has to know before making their purchase. On top of that, we screened the best Toronto real estate agents who are willing to share their information with home buyers.

By analyzing the real estate market trends in Toronto from January 1996 up to today, we can trace similar patterns during the time that happen over and over again. I’ll explain how to use the these real estate trends in Toronto to find out the best time to buy a house or a condo in Toronto.

Best time to buy a house in Toronto

The chart below shows the annual trends in the Average price of Detached houses sold in Toronto in the past 9 years. Each year is represented by a line.

Best time to buy a house in Toronto

Starting from 2010, we see the lowest prices have happened in August 2010, the average price of a detached house was $590K.

The majority of detached home buyers are Families with children, then come in the real estate investors. People who have kids usually prefer to move during end of spring or the summer, because of the school situations.

The trend for 2011, lowest months were January and August. January, July and August were lowest months for 2012. The lowest house prices in 2013 happened in January, July and August as well.

2014 trend was a bit different as in that year March was among those lower months. However generally March is not a low sales month.

In 2015 January and July were the slowest months, and in 2016 January, March, July and August were among the lowest months.

2017 was an exception in Toronto’s real estate. However even this year was an exception in Toronto’s real estate, the trend was similar, January, July and August, which August was the lowest month among them. In 2018 and 2019, the lowest months were January in both years. Followed by August and July.

In 2020 however August was a very busy month the reason was the pent up demand that moved to the summer from the spring market. Those who were sitting on the sidelines decided to enter the market and that pushed the number of transaction from regular spring market to the summer. basically we were looking at the late spring market in August 2020.

So you can see the trend is almost similar during the past 10 years since 2010. But what each of these mean for home buyers? How can a home buyer finds out what’s the best time for them to buy a house? I’ll explain that for two common positions that buyers have. Most of the house buyers are either End users or Real Estate Investors. End users are those who want the house for their personal use or for the use by their families. Investors on the other hand follow two paths, A. Flipping the house or B. Renting out the house to get cash flow. If you are an End user or a real estate investor who wants to flip a house and make money on it, this data is more relevant to you.

If you are a property investor who is interested to get a property and rent it out to generate cash flow, the time-line would be different. Please contact us to discuss your scenario to give you a better idea of what would be the best in your case.

Tip for End User House buyers:

If you are an End user or First-time home buyer, the best time to purchase a house for you is during the month of August ( read above regarding August 2020 phenomenon). A Top Toronto Real Estate Agent can help you with the best time to buy and deals out there.

Tip for Investor House buyers:

If you are an investor, interested in buying a home, the best time to buy a house for investment would be December, January, and the beginning of February. If you are looking to flip the house or make any alterations to get it ready for rental market, you can give the sellers a longer closing, so they stay in the house and pay your mortgage, till you get a construction permit.

Best time to buy a condo in Toronto

Now look at the same charts for condos in Toronto. The same pattern can be seen, however the ups and downs are a wee bit different. So if you are a Toronto condo apartment buyer, read the below review.

Best time to buy a condo in Toronto

Starting from 2010, and 2011, you don’t see a huge change in the pattern. However the price lines show January as the lowest month in both years.

Moving to 2012 and 2013, condo sales starting to show some patterns, still January among the lowest months, followed by July and August. Yet in 2013, February was among the lowest months.

In 2014 we see the famous classic pattern, lowest months were January and August. In 2015, the lowest months were January, February and July.

In 2016, which the condos started to move faster, we see the lowest months as January, March and July. 2017 was the real condo year, it had started from 2016, but bloomed in early 2017, January, February and July were among the lowest months, even though the high in April was an acceleration in price increases that condos had yet seen in Toronto.

In 2018 we got back to the healthier market and seeing the classic trend repeating over and over again, starting with the lowest month January, followed by February, July and August.

Very important tip for End user condo buyers:

If you look at the trend above, you can tell the lowest month in 2020 most probably could be January. And if you look at 2016 and 2017 Trends, if the market follows the same path, chances are very high that the prices could have another jump around March 2020 ( This has happened before COVID-19). So competition might be more than what you expect. In the competitive sellers market, you should expect more bidding and multiple offers. In order to get the property you’re interested, you should be ready and get educated about possible outcomes in advance.

As I mentioned above the COVID-19 changed the spring market pattern and we had a late spring market in Toronto. Basically the pent up demand moved forward to the summer and changed the traditional August. In August 2020 we saw record breaking number of sales, which changed that patter, which happened because of COVID interrupting the annual trends in Toronto’s real estate market.

Get consult from a Top Toronto condo real estate agent. The market for condo buyers, especially for first time buyers would be a bit tougher next year. Ask your agent to educate you about all the ins and outs and pros and cons of each property. If possible ask your agent to meet you before entering the market for a consultation or educational meeting. The consultation meeting with our Toronto Condo real estate agents is complimentary. You can find and get matched by top real estate agents based on your area in a few steps in a minute.

Tips for Investor Condo Buyers:

January also would be a good time to enter the market for investors. Because investors usually are not short in cash and often put down 20% or more, competing in the bidding wars are easier for them.

(There are still very few plans for investors, that you might be able to get another mortgage with less than 20% down payment on your second property under certain circumstances, for further information contact us).

Best time to buy a condo in Downtown Toronto

Downtown Toronto Never Sleeps ( read 2020 Covid effect below )! Well we’re not near Manhattan yet, but on the way to becoming one. So lets review the Downtown Toronto charts to see if there is a good time any where in the calendar to buy a property? If so, when’s the best time to buy a condo in Downtown Toronto?

Best time to buy a condo in Downtown Toronto

During 2010 to 2015 we don’t see any specific patterns in Downtown Toronto’s condo market, but in 2016 we start seeing the pattern. 2016 was the year that condos started picking up and moving ahead of other property classes. January and July in both 2016 and 2017 were the lowest months respectively. 2018 in downtown Toronto was a bit different, January were a lower months but the summer market was pretty hot, hot enough that we didn’t have any low month in summer 2018.  In 2019, the trend was more upward, January and August were lower months, but the pattern shows that 2020, for condos in Downtown would be a tight year in terms of inventory.

The inventory in Downtown Toronto’s condo market were very tight at the beginning of 2020, but after COVID hit, the market changed. Downtown Toronto is depending on Students, Investors, Immigrants and Office worker. COVID 19 had an effect on those groups. We had way less international students and immigrants come to Toronto, on the other hand many office workers are adapting to working from home. Thus many condos are vacant or the owners decided to sell and move to suburbs. You can read more about it in the recent Toronto Real Estate Market news.

Read More : Best Condos in Toronto

Tips for condo buyers in downtown Toronto:

I expect 2020 would be a year that we see another above average jump in condo prices in downtown Toronto. I don’t see the jump as bad and high as 2017, but it looks to be higher than what we had in 2018. So if you are looking to buy into Downtown Toronto, don’t miss January and February 2020.

I highly recommend you to consult with a Downtown Toronto Real Estate Agent who can guide and navigate you through downtown market. Winning your dream property in Downtown Toronto needs specialized real estate agents.

Read More: Should You Buy Or Sell First In The Toronto Real Estate Market?

Conclusion:

Please view the Pro Tips that has been written above for different scenarios. Overall January and August are the best months to buy a home in Toronto. This article is based on the experiences and analysis of a seasoned real estate agent who has been working in the front lines of real estate transaction in Toronto every day.

If you can qualify to purchase a home, do it today is better than tomorrow. After all, we are living in a world class city. I’ll talk about it in the future that why the prices still have a lot of room to go higher and why real estate in Toronto would be a great investment.

 

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