Investors now make up more than 25% of Ontario homebuyers, pushing prices higher, experts warn
CBC
Five years ago when Tehmeema Safdar's husband was offered a position as a medical researcher in Toronto, she dreamed of putting down roots for her children in the city.
"We were kind of nervous and a little bit excited," said the 43-year-old mother of three.
"A lot of people were telling us: go to Toronto… it's a nice place."
But those dreams have slowly faded: since moving from Edmonton they've been renters and the family has had to move three times. They currently rent a home in Oshawa.
Safdar says they continued to accumulate their savings upon arriving in the city, but watched as prices soared. Within a few years they realized owning real estate in the Greater Toronto Area was increasingly out of reach for them. They're now looking at the possibility of leaving altogether.
"Whenever we get money — enough for buying a house — the price jumps again ...and then jumps again," said Safdar.
"We're trying to chase our dream."
Safdar's story is not unique, and is becoming the growing reality not just for families moving to Toronto from other cities, but for first-time buyers who've lived their entire lives in the city. According to the Toronto Regional Real Estate Board the average selling price for all homes combined rose by 19.3 per cent year-over-year to $1,155,345.
And as prices skyrocket, recent data suggests people who own more than one property in Ontario make up more than 25% of buyers in the province.
It's a stark contrast to just 10 years ago when investors made up the smallest percentage of residential real estate transactions. According to the data, they now make up the largest segment, and experts say not only is that driving up prices, it's making it increasingly difficult for those trying to get into the market to compete in bidding wars.
Those experts are sounding the alarm not just on the potential of future economic implications, but also what this trend could mean for the makeup of big cities like Toronto.
It's a reality Jermaine L. Murray knows well.
The 31-year-old isn't looking for a property for himself, but rather for his mother who is close to retirement and is responsible for taking care of his sister with special needs. He says she had to sell her home because of a divorce a few years ago, and whatever money she received isn't nearly enough for a down payment on another home.
"The way that the market has been going has totally outpaced the amount of savings that they've been able to have," said Murray.
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