Toronto has one of the fastest-paced real estate markets in the world, and the value of every type of property tends to grow quickly. For example, the average cost of a Toronto home sat around $821,392 in 2020. By 2021, it had increased to $1,090,992. By March of 2022, the average house cost shot up to $1,299,894.
What is driving this massive growth?
Toronto sees many new residents moving to the area every year, from immigrants to the country and young professionals in search of their first high-paying career. Plus, many condo dwellers have decided to invest in larger homes with more space, a backyard, and maybe even a parking space.
What will happen to housing prices over the course of the year? Of course, no one knows for sure. However, Toronto’s steady population growth means prices are not likely to decrease. Now is an excellent time to invest if you’ve been thinking of upgrading to a larger home.
What is the safest real estate investment you can make during a shifting market? Consider turning your home into an income property.
Buying Property is an Investment
When buying a home, you want to find something that suits all your needs. However, it’s also important to remember that real estate is an investment, and one of the things to consider is the resale value.
The resale value refers not to the current purchase price, but to the amount you will get if you decide to sell your home later. The original purchase price of a detached house is almost always higher. Still, the rate of growth will depend on many factors. Let’s take a closer look at each.
Semi-Detached
A semi-detached home in Toronto can be an excellent way to upgrade to a larger space. It shares only one neighbouring wall and provides much more privacy and less noise transfer than a condo or even a townhouse. You can also expect to enjoy more natural light, and you’ll even have space for a small backyard patio and garden. The thought of hosting backyard parties and BBQs is a dream come true for many homebuyers!
A semi-detached usually offers a little less space than a detached home, but that isn’t always the case. It will depend on the property and the area.
However, the resale value of a semi-detached house in Toronto may surprise you.
According to the Canadian Real Estate Association, the average price rose by 35.6% from 2021 to 2022 to $1,295,000. This was the highest increase of all property types.
What makes buying a semi-detached house so appealing?
The number one benefit is its affordability. It is hard to find a detached home in Toronto. When a listing does come up, it is far out of the price range for many homebuyers. The average cost for a semi-detached unit is about $200,000 less. A smaller down payment is required, and you can look forward to lower monthly payments. The increased affordability of a semi-detached can often mean getting to enjoy a larger home faster than trying to save for a detached unit.
Deciding whether to buy a detached or semi-detached home is only the starting point. Here are some other articles that will help you in your search:
- Finding Your Forever Home in Toronto
- Should You Buy or Sell First in Toronto in 2022?
- 5 Things to Watch Out For When Buying a Fixer-Upper
Detached
The rising cost of real estate makes buying a detached home in Toronto a privilege only a very few people can afford. The benefits are obvious. With no shared walls, you have complete privacy. The property is yours to renovate and update as you want.
You don’t have to argue with your neighbours over whether you are making too much noise.
Typically, a detached home will have more square footage and a larger backyard to enjoy during beautiful spring and summer afternoons.
The disadvantages are primarily cost-related. If you need a new roof, the expense is 100% yours. You can’t ask your neighbour to pay half.
In 2022, the value of detached homes reached an all-time high, averaging out at $1,565,000. However, the increase in value from 2021 to 2022 was 27.2%, which was surprisingly less than the average appreciation of semi-detached homes.
Other Factors to Consider
Real estate remains an excellent investment no matter what type of property you choose. Both building types hold their value and will likely provide a solid return on your investment if you decide to sell later. There are, however, other factors to consider.
- The age of the building
- How well it has been maintained
- The location and easy access to amenities
- Future investment potential
- Outside factors that affect the real estate market
Before deciding, it’s vital to get professional guidance to discuss the potential benefits and risks of either option. A local real estate agent will be able to tell you the past and current values of homes in your desired neighbourhood to help you choose the wisest course of action.
Do you want to talk more about Toronto real estate, particularly the West End? We are happy to help! You can get in touch with us right here.
