Toronto Detached Toronto Homes: Too Expensive to Sell? (Infographic)
Prices for detached houses in the City of Toronto dropped 18.6 per cent this February to an average selling price of $1,282,240 from last year, according to data from the Toronto Real Estate Board (TREB).
That’s an extreme price plunge compared to all other market segments. Semi-detached housing declined 9 per cent, while townhouses grew 15.5 per cent and condos 10.7 per cent.
Although detached Toronto houses are a relative bargain compared to February 2017, when they reached an average selling price $1,573,622, they remain out of reach for most buyers. One could buy two Toronto condos, literally, for the price of a single detached home.
A monthly mortgage for the average Toronto detached house, with a 20 per cent down payment amortized for 25 years at 3.49 per cent, would cost $5,116 . You’d need a monthly after-tax household income of at least $16,700, or $200,000 annually, to limit your housing expenses to 30 per cent of your income – as recommended by most personal finance experts. And that’s not even counting counting property tax, insurance, repairs and hydro.
The median after-tax income for a two-or-more person household in Toronto is just $73, 695, according to the last data available from Statistics Canada. Out of 2,294,790 Torontonians aged 15 years and over earning taxable income, just 116,680 earn $100, 000 after-taxes a year. That likely means less than 5 per cent of Torontonians can properly afford to buy a detached house.
Within the City of Toronto, 524 detached houses were sold in February, compared to 793 last year.
TREB expects this trend to continue, with properties that are more in line with the majority of incomes leading the market:
“As we move further into the spring and summer months, growth in sales and selling prices is expected to pick up relative to last year. Expect strong price growth to continue in the comparatively more affordable townhouse and condominium apartment segments,” says Jason Mercer, TREB’s director of market analysis.
Check out the infographic below to draw your own conclusions:
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You may also be interested in: Condos Were a Best Seller in 2017: Toronto Real Estate Infographic
Writer: Danielle Kubes
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