Photo: James Bombales
A new survey suggests more and more Torontonians are considering buying a home at a time when a flurry of factors, including rising interest rates and tougher mortgage rules, are creating higher hurdles to ownership.
Some 29 percent of respondents to a recent Ipsos survey say they are likely to buy a home in the Greater Toronto Area this year. That’s up from the 26 percent who said the same thing in last year’s survey, which has been commissioned by the Toronto Real Estate Board since 2016.
Of these homebuyer hopefuls, 10 percent indicate they are “very likely” to follow through, unchanged from a year ago. “This suggests that the share of GTA households who have absolutely made up their mind to purchase a home in 2019 has changed little over the past year,” notes TREB in its Market Year In Review & Outlook Report.
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“What has changed more noticeably is the number of survey respondents who said they were somewhat likely to purchase a home in 2019,” the report continues.
The share of these homebuyers, who aren’t quite sure, rose to 19 percent, compared to 16 percent in the previous year. “This suggests that more people are at least thinking about purchasing a home over the next year,” TREB explains.
A possible takeaway from this is that potential buyers are getting used to changing circumstances in the wake of policy moves such as the aforementioned stress testing, which pits some mortgage applicants against higher qualifying rates than they would have faced previously.
“Whenever major government policy changes pointed at the housing market come into effect, there is generally an initial overreaction resulting in a large but temporary pull-back in home sales,” TREB says, adding this was the case last year.
In 2018, GTA realtors reported sales totaling 77,426 units, down 16.1 percent from the last annual tally, while the average price sunk to $787,300, off by 4.3 percent from 2017. “Households generally adapt to policy changes by changing their preferences,” the TREB report states.