Rapid Decline In Toronto: Is The Real Estate Bubble Bursting?

There is no doubt home sales have slowed significantly in Toronto over the past few months. Some say it’s because homeowners are rushing to get the big bucks for their properties before a dreaded crash. Others say it has something to do with new regulations by both the federal and the Ontario provincial governments. There is a sudden influx of properties on the market and a drop in buyers which will see to it that prices fall over time. What does this Toronto trend mean for the rest of the country, though? Is the real estate bubble bursting? How badly will homeowners be affected by this and what effect will it have on new buyers?

If you already own a home in Canada, you might be dreading a sudden and significant drop in your property value. You might be feeling as though you missed your window of opportunity to sell your home for an inflated return. You have to keep a couple things in perspective, though:

Real estate is a long-term investment

- Housing costs have always had peaks and valleys but owning a property over a long period of time (25-30+ years) will almost always see the property value go up. So, as long as you’re okay owning the property for that amount of time, you’re pretty much guaranteed a good return on investment.

Homes are also for living in

- The entire purpose of a home is to provide you with somewhere to live. So long as you’re happy in your home, what does it matter what price tag you could attach to it? Sure, you can money buying and selling a property at the right time, but if what you really want is a home to live in, you’re already there.

If you’re a prospective buyer looking to purchase a home in Canada, a bubble burst might be a welcome thing. A sharp and sudden drop in housing prices would make buying a home more affordable. As such, buyers can always convince themselves to wait a little longer for better prices and more choices.

However, don't wait forever for the right price on your perfect property.

If you want the brutal truth, all we have is speculation. No matter how brilliant the latest financial guru is, none of us can see the future. No one really knows if the bubble is going to burst. All we know for sure is that it hasn’t yet, and my advice for you is to operate on what you know. We live in a country where housing prices are astronomical. As a buyer, you have to work with that. As a homeowner, this can be a benefit, but don’t sell unless you really want to move. Don’t let all this speculation change your life goals and plans.

Do you think the Canadian housing market bubble is going to burst? Let us know in the comments!