The Toronto Real Estate Market is Hot, Hot, Hot!

The good times continue to roll for the Toronto real estate market going through November. Home sales have continued to increase as more consumers regained their confidence in the real estate market.

Sales through the mid-point of November soared to 3,666 in number, which amounted to an amazing 84 percent increase over November of 2008. October had also seen big sales, amounting to an astonishing 8,476 in number. New home sales made up just about half of all those sales.

 With the rise in home sales in November, so too did the cost of homes rise. In November, there was a 10 percent increase over the price of a home compared with November 2008. the average price mid-way through the month of November was $415,066.

 Some industry analysts are warning that this could be the sign of a housing bubble, but other experts point out that the percentage of income being paid to mortgage payments has remained stable, which means there should not be a bubble.

 One reason that housing prices are so high right now is because there are not enough homes on the market in Toronto. There are many buyers, but only a few sellers. This creates a damaging supply and demand. When there is more demand than supply, then there is high prices for what people want. In this case it is houses. Bidding wars have started on many houses, and this has caused housing prices to increase greatly. This is in sharp contrast to one year ago when there was more supply than demand, which caused the housing prices to fall dramatically throughout the later part of 2008 and well into 2009.

This is expected to change as the interest rates go up, meaning many potential buyers will opt out, and as more homes are built. By the beginning of 2010, there should be a balance and this will stabilize the housing prices to more natural levels.

 The housing market in Toronto is one of the best in the country, only outmatched by Vancouver it seems. As time goes on and 2009 moves into 2010, the housing market will change and fluctuate. What does seem to be certain is that the recession is coming to an end and the surging housing market is a big part of that.

 Thankfully, the housing crash of 2008-09 seems to have only been a small blip on the real estate radar screen.