This is for educational purposes only; it does not guarantee future performance or serve as financial or tax advice.
There’s no denying it—Toronto’s real estate market is facing more uncertainty than in recent years. With small business confidence at a 25-year low, it’s clear that economic concerns are on the rise. But here’s the thing: while uncertainty can make us hesitate, waiting for the “perfect” moment often doesn’t lead to better outcomes.
Let’s break it down so you can make smarter decisions.
Scenario 1: What If Prices Drop Further?
Let’s talk about the biggest fear keeping people on the sidelines: What if Toronto real estate prices drop even more?
Sure, prices have already dropped 15-20% since 2022, and the market has been flat for almost three years. But here’s the key question: are you waiting for something that might not happen? Toronto’s housing market is driven by real demand—there’s always a shortage of supply, which prevents prices from crashing.
You might wonder, “If the economy worsens, won’t that make prices fall further?” The truth is, Toronto has a solid foundation, with strong housing demand from both buyers and long-term renters. Plus, as interest rates begin to drop, homes will become more affordable, which will help stabilize the market.
BMO says we’re already halfway through the market correction. Prices have likely already hit their lowest point. They don’t expect prices to return to 2022 levels until 2029, but waiting could cost you more. Even if prices stay flat, falling interest rates will increase your buying power. Unlike the 1990s when rates stayed high for years, today’s rates will eventually come down, improving affordability.
So, if you’re waiting for a massive drop in prices, you could miss out on the opportunities available now.
Scenario 2: The Market Stays Flat—What’s Your Capital Doing?
Now, what if the market just stays flat? No massive crash, no big boom—just steady, like it’s been for the past few years. Is it better to wait and see, or should you consider jumping in now?
Here’s the thing: With falling interest rates, now is a strong time to buy. In today’s buyer’s market, there’s less competition, fewer bidding wars, and more room for negotiation—things that weren’t possible a few years ago.
Let’s break it down with some numbers. If you buy a property today, you could expect a return of 10-15% from rental income with just a 20% down payment. Not bad, right? And if you’re willing to take on a property that needs some work—whether it’s a renovation or conversion—your returns could be even higher, especially as rents continue to rise in certain areas.
But here’s the real question: While you’re waiting, what’s happening to your money? Is it sitting there, losing value because of inflation? Are you getting less with falling GIC rates, or facing uncertain returns in the stock market compared to the relatively stable outlook of real estate? Instead, why not put your capital to work and start earning returns?
The bottom line: Even if the market stays flat, investing now is likely a better move than waiting. With falling interest rates, less competition, and strong potential returns, taking action today will probably be a smarter way to use your capital.
Scenario 3: The Market Starts to Move Up—Chasing the Market Gets Expensive
Let’s imagine the market picks up again and prices start rising. While it’s unlikely that prices will skyrocket in the near future, what happens if the market does improve slowly?
When the market heats up, it becomes more competitive, and you’ll end up paying more for the same property the longer you wait. As prices rise, good deals become harder to find, and the buying process becomes more stressful with multiple offers and fewer conditional ones. Plus, if rents don’t rise as quickly as prices or if rates go up due to a recovering economy, rental yields could shrink.
So, even if the market improves, waiting could mean missing out on better deals and higher returns you can grab now.
The Tariffs & Political Landscape – How It All Ties In
Another factor to consider is tariffs. These could make things more expensive and add inflationary pressure to home prices. They could also hurt the economy and weaken GDP, offsetting the inflation pressure on prices. The real challenge right now is how much tariffs will affect us. Once we know what Trump plans to do and get past the initial inflation spike, things should start to stabilize. Over time, as tariffs become the norm, businesses will adjust, and the market will adapt.
Looking ahead to the upcoming election, new leadership could bring a sense of optimism to the market. Historically, after elections, we often see a bounce in economic confidence, which could lead to a more favourable environment for long-term investors.
Bottom Line: Take Action, Don’t Speculate
Yes, the market is shaky right now, but doing nothing is also taking a position and speculating. As long as the numbers make sense, we prefer making informed decisions rather than waiting for the “right” time to come.
Next Steps - Let's Connect!
If you’re ready to take the next step or have questions about your options, reach out.
Let’s explore the best strategy for you, based on real data—not guesswork. We specialize in helping investors make confident, informed choices when it comes to multiplex properties in Toronto. Whether you’re looking for a fully renovated, turnkey property or one with conversion potential, we’ll guide you through every step of the process to ensure you’re making the right move.
Here’s what it’s like to start as a client with us:
- Initial Consultation: We’ll talk with you to understand your needs and teach you how to invest wisely in Toronto real estate.
- Market Search & Purchase: We’ll search the market to find the perfect property for you.
- Renovation Support: If the property needs renovations, our trusted contractors are ready to help, and we’ll coach you as you manage the project.
- Leasing and Management: If you need help renting out and managing your property, our leasing and management team is here for you.
Ready to get started? Click on the link below, and let’s start working together!
What Toronto Real Estate Investment Is Right For You?
Check out our complete Toronto real estate investment guide for all the details and real-life examples. If you’re ready to dive in, just book a call with us!
