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Wednesday, 22 February 2017
Toronto Condo Bidding Wars Make Appraisals Difficult Says Condo Specialist Casey Ragan
TORONTO, ON--(Marketwired - December 12, 2016) - Toronto condo and loft specialist Casey Ragan, a sales representative with RE/MAX Hallmark Realty Ltd., Brokerage, and owner of the Toronto condominium real estate website (www.TheCondoLife.com), says that bidding wars are making it hard for realtors to appraise Toronto condo and loft properties with accuracy. According to Ragan, condo bidding wars, now commonplace in the frenzied Toronto loft and condominium market, are driving up prices across the city. And, rapidly escalating condo prices are making it difficult to place a precise value when appraising lofts and condominiums for sale. "Toronto continues to be a strong buyer's market, with condo prices hitting new highs each month. With prices reaching new levels monthly, setting a condo's value using the most recent comparable sales (units sold within the last 90 days), no longer gives an accurate picture, and a price that is in-line with current price offers," states Ragan.
"The Toronto loft and condominium market has been going strong for several years now, with no sign of slowing down. This year has been the busiest ever, with units selling almost as fast as I can show. With more buyers in the market than there are listings, increased demand for Toronto condos and lofts is pushing prices ever higher. Major factors that are contributing to the buying frenzy include immigration, low inventory, a weak Canadian dollar, and people buying before new mortgage rules make it more difficult for many Canadians to purchase a home," reports Ragan.
"The new mortgage rules, which come into effect on Oct 17, 2016, will require all high-ratio mortgages to qualify for 5-year mortgages using the Bank of Canada's qualifying rate (currently set at 4.64%), instead of the actual (much lower) mortgage rate. This means that buyers with a down payment of less than 20% must now qualify for a more expensive loan, even if they don't have to make higher payments. The new rule will prevent some buyers with low down payments from qualifying for the home they want and delay some first-time buyers from entering the market. There are some who predict that the new rules will cause Toronto housing prices to tumble. While, initially it may cause a few ripples, there are just too many other factors at play to slow the market. If anything, Toronto condominiums will be more popular than ever, with the average price of a single detached home in Toronto is 1.2M, Toronto condos are still a relative bargain and much more affordable for first-time buyers who want a home in the city," claims Ragan.