A Return To Normal, It’s a great time to look for a new home
As has always been my intention for my contribution to this magazine, it is to tell the story from the sales floor. I am happy to report that after many months of slow sales in the lowrise sector, signs of life are appearing and we have seen some great openings throughout the GTA as 2018 came to a close. Markets like Brampton, Stouffville, Pickering and many other suburban communities have opened up with lineups and crowds ready and wanting to buy a new home.
Sales in many of these new releases have done very well based on the absorption of the previous 12 months. What has also been nice to see, is that it is just not sales on entry level product such as townhomes and small singles, we have also seen the luxury market with homes in the multi-million dollar range selling again.
Price levels have stabilized and purchasers are more confident that the new house market has corrected. What makes me most excited about the current state of the market is that we are seeing real people looking for a place to settle. Whether it’s to start or raise their families, people want to buy. The investors who fueled the crazy boom and sellouts in late 2016 and early 2017 have more or less disappeared.
This is not to say that lowrise preconstruction homes are not a great investment opportunity; I would say quite the opposite. With highrise preconstruction pricing hitting new heights with every new release. The continuing rental demand and pricing makes more sense in lowrise these days, certain pockets and products are a very smart place to invest these days.
I said in a previous article that pricing will not drop much lower and should increase based on the enormous costs involved with bringing a development to market and the costs of construction. A lot of the product on the market right now is being sold at a level that is below what it should be sold for; this is strictly to keep the engines moving in residential construction.
If you’re looking for a new home it is time to check out the new openings and existing communities and make that deal.
Elliott Taube is president of International Home Marketing Group, a full-service sales management and marketing firm. IHMG.ca