With home prices in the Greater Toronto Area hitting their lowest in four years, many first-time buyers are thinking about buying their first condo, and one expert is weighing the pros and cons of entering the market right now.
A new Toronto Regional Real Estate Board (TRREB) report reveals that the GTA is experiencing its “best home sales result” since 2021, with better prices and a slightly higher demand.
According to the report, the average selling price in the region fell 5.5 per cent in July, standing at $1,051,719, which is the lowest it has been since 2021.
As a result, the market is seeing more movement with a 10.9-per cent increase in home sales compared to last year, with a total of 6,100 sales registered in July.
Meanwhile, listings rose 5.7 per cent, with 17,613 new properties for sale last month.
“Improved affordability, brought about by lower home prices and borrowing costs is starting to translate into increased home sales. More relief is required, particularly where borrowing costs are concerned, but it’s clear that a growing number of households are finding affordable options for homeownership,” TRREB President Elechia Barry-Sproule said in a statement.
TRREB also released Q2 numbers for the condo market, which show a significant drop from 2024.
According to the report, although the average selling price of a condo is $685,961, marking a 5.9 per cent drop from last year at this time, sales have also fallen 20.9 per cent year-over-year. In Toronto proper, the average price was $717,210, down 6.3 per cent compared to Q2 2024.
Meanwhile, with many condos available and others being constructed, active listings have gone up by 39.3 per cent.
But with prices going down and more listings available, one local real estate expert says there are some important factors to consider before deciding to buy a condo in the GTA right now.
PROS FOR BUYING A CONDO IN THE GTA RIGHT NOW
An Opportunity to enter the market
GTA-based realtor Bethany King tells Now Toronto that with condos reaching their lowest price in four years and buyers struggling to close a deal, many people who might have been short of qualifying for a mortgage before, might now have an opportunity to do so.
She says the current market represents an opportunity for some to put a foot in the door of their first home, and work towards building equity and move up to something bigger in the future.
“Compared to other attached homes, condos are now at a much more affordable price point and for many would-be buyers, that means the down payment requirement is less and there are more opportunities to enter the market at a price that they can qualify for,” she said.
Negotiating power
King also says that as many sellers look into making their properties more attractive, buyers now have an opportunity to bargain over the terms of the purchase, including closing dates, inclusions or incentives.
Moreover, some sellers are even advertising special offers, such as discounts, free first mortgage payment, or higher commissions.
Low-maintenance
Although many people looking to buy a home turn to bigger houses, the realtor says there are certain advantages to the condo lifestyle, including less maintenance.
While in a house, the owner is responsible for cutting grass, shovelling snow and managing external repairs, while in condos this work is usually done by the building itself.
“It’s a great option for people who don’t want the upkeep that comes with freehold homes,” she said. “And because most condos come with amenities like gyms, pools, and party rooms, you’re able to enjoy the convenience of those perks right in your building often without needing separate memberships elsewhere.”
Location
Lastly, King says many condos in the GTA are located in amenity-rich neighbourhoods which are usually walkable, and have good access to transit. These areas might be a great fit for buyers looking for a more urban lifestyle.
CONS FOR BUYING A CONDO
Low opportunities for short-term ownership
Although now might be a good time for first-time buyers to enter the market, it can be a bad idea for those looking to build equity quickly.
With several pre-construction condo projects approaching their delivery dates and a big supply of units across the region, many sellers are now having to list their condos for less than their original price or offer a series of benefits to stand out in the market.
That might seem like a good factor for buying, but it also means that there is less opportunity for those looking to purchase a condo and re-sell it in the near future.
“Because of that oversupply, appreciation in the short-term may be very limited. Condos right now should really be considered a long-term investment. If someone’s not planning to hold onto the property for several years, it may not make financial sense at this point,” King said.
Condo rules
Despite the advantages of having property management, King says it could come with a catch.
Condo owners are also required to abide by the rules and decisions of their condo board, which means they could have less control over renovations, the use of their space and even if they can have pets.
Maintenance fees
Condo owners are also required to abide by condo maintenance fees, which can be a significant addition to their property’s monthly cost.
According to King, these costs are also factored into debt servicing rations, with higher fees having the potential to reduce buying power.
“It’s definitely something that needs to be taken seriously when calculating what you can actually afford.”
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