
When the housing market is on fire, it seems as though that rush will never end. Then, when conditions slow down, it feels as though the lull will go on forever. The only thing anyone can ever predict about the Toronto real estate market is that it is entirely unpredictable. The only constant is change. It can be slow and subtle or sudden and dramatic.
Busy markets are great for sellers. Buyers often compete and outbid each other to have a chance at getting their offer accepted. These conditions are the opposite of fun if you’re the one trying to buy a new house.
Since we can’t predict which way housing prices will go, the next best thing we can do is take a step back to assess the situation. In this post, we’ll talk all about how to capitalize on any advantages you might have and make the most of your purchase in a shifting market.
Do you want to use every tool at your disposal to make your first home-buying experience a success? Then don’t miss our free guide, “Top 10 Mistakes Buyers Make—And How to Avoid Them.” Download your copy for free right here.
When House Hunting in a Hot Market
Searching for a new Toronto home in a busy seller’s market can be a harrowing experience. You see a listing you love, at the right price, with everything (or nearly everything) on your wish list, then poof! It’s gone before you even had a chance.
Or, you find yourself up against multiple buyers, which forces you to bid more than you were comfortable with. If you’re not careful, emotions can get the best of you and cause you to pay too much for a house when walking away would be the better choice.
If the market is heating up as you begin your house hunt, you might be tempted to put it off and wait for a better opportunity. This path can also be hazardous to your homeownership dreams for several reasons. As we mentioned before, the market is unpredictable.
- Prices and demand might fall if you wait.
- Or conditions could get even more competitive the longer you put it off. This could push the boundaries of your budget while limiting your options even more. You just never know.
Buying a home only for prices to fall later is every buyer’s worst fear. However, what’s the worst that can really happen when you look at the big picture? Values fluctuate all the time, but the long-term trend has always been up.
There’s no need for despair if your house loses value shortly after your purchase. It won’t be long before housing prices rebound and your equity starts to grow again.
Make the Most of Any Situation
Prices may be high in a busy seller’s market, but there is a silver lining. These are usually accompanied by lower interest rates, which may mean you end up paying less for your home in the long run.
Getting the timing perfect is next to impossible. When it happens, it’s usually by accident. However, the sooner you buy a house, the more potential you have to build your equity and purchasing power as time goes by. That’s why real estate agents often talk about your “time in the market” rather than timing the market.
Now, we’ll look at some of the scenarios you may find yourself in as you begin the hunt for your new home.
The right location is among your highest priorities when searching for your Toronto home. The posts below will help you narrow it down:
- These Toronto Neighbourhoods are Perfect for a Fresh Start
- Up and Coming Neighbourhoods for Families
- Top Dog-Friendly Neighbourhoods in the West End
When Prices are Down and Competition is Low
Buying a house today tends to come with a certain amount of sticker shock, especially in Toronto. That said, prices here can fluctuate based on demand and other economic factors.
Beginning your home search when demand is low can help you get the best possible price. Even more, you’ll likely benefit from higher levels of inventory, which gives you more choices. You don’t have to rush to place an offer before you are ready. And you likely won’t have to contend with multiple buyers who want the same property.
That’s the good news. It’s also important to be aware of the potential downfalls of these seemingly favourable situations. Buying in a buyer’s market comes with downsides? It can if you are not prepared!
- The market may be favourable, but it’s important to not get too confident. One pitfall is that because buyers have so many choices, they get overwhelmed and end up putting off their purchase. In the meantime, the market can change or you could still lose a home you love to another buyer.
- Another temptation is to accidentally insult sellers with offers that are too low. You may have more negotiation power in a softer market. Just remember that you still need to be realistic.
- Lastly, when prices are low, interest rates are usually higher. You save money on the house, but borrowing becomes more expensive. This isn’t always the case, but it is often the case.
A local real estate agent can help you bypass any disadvantages and truly make the most of an already positive situation. Through skillful planning and negotiation, you can buy your new house at the lowest possible price and with terms that are favourable to you.
Will the Toronto Real Estate Market Crash?
Reading news headlines can cause a lot of anxiety. While it’s important to be informed, you never want to blow anything out of proportion. Toronto real estate moves quickly. After a particularly busy surge in activity, prices can rise artificially, and a market correction soon follows.
Often, these adjustments cause fears of a crash. In reality, they are just corrections, and the market will balance out in the end. A bounce-back is inevitable. It’s just a matter of when.
Looking for more nuanced tips to navigate any market when buying your home? Start with the resources below:
- Should You Buy or Sell First in a Shifting Market?
- Real Estate Myths, Busted!
- What Is Fractional Ownership in Toronto?
Toronto Real Estate Is a Smart Investment
All in all, real estate is still regarded as one of the best investments you can make. This is especially true in Toronto as the demand for housing never ends.
Remember that a house is more than a roof over your head. It’s a real, tangible asset that will create value and increase your equity over the years. With that in mind, you should focus on buying a house when you are ready and the decision aligns with your lifestyle rather than on what the market does.
When you’re ready to buy a house, expert guidance is the key to getting the best results in any market. Feel free to reach out to us at erica@ericareddy.com or call 416.443.0300 with any questions you may have.

Meet The Erica Reddy Team
Find out how our specialized skill sets and extensive Toronto market expertise empower your real estate venture.