With the house market booming in Toronto, reaching a record number of home sales last month, it’s difficult to buy a detached home for less than $1 million.
In September, the average price was $1,185,000 in the city.
Still, there are a few neighbourhoods where the median price is below this high price point.
If the purchase price for a property is lower than $1 million, the minimum down payment required ranges between 5% to 7.5% of the purchase price, compared to the minimum down payment of 20% of the purchase price for properties that are over.
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So, this means buyers purchasing a home under $1 million need “a substantially smaller down payment relative to property’s total price.”
For example, a purchase of $1 million will require a minimum down payment of $200,000; however, for a home purchased for $999,999, a buyer needs a minimum down payment of $75,000.
Top 5 neighbourhoods with the lowest median detached house price:
1. W03 (Rockcliffe-Smythe, Keelesdale-Eglinton West)
- Median detached price: $875,000 (+13% vs. last year)
- Down payment required: $62,500
2. E09 (Morningside, Woburn, Bendale)
- Median detached price: $890,000 (+15% vs. last year)
- Down payment required: $64,000
3. W10 (Rexdale-Kipling, West Humber-Claireville)
- Median detached price: $891,500 (+14% vs. last year)
- Down payment required: $64,150
4. E04 (Dorset Park, Kennedy Park)
- Median price: $918,000 (+15% vs. last year)
- Down payment required: $66,800
5. E10 (West Hill, Centennial Scarborough)
- Median price: $967,000 (+15% vs. last year)
- Down payment required: $71,700
According to Zoocasa, in 2019 there were 14 neighbourhoods where houses were selling below the $1 million mark.
“Now that home has become not just where we live, but for many of us, also where we work, finding a space that can accommodate both, at an affordable price within city limits can be challenging,” Evelyn Anders, Toronto-based real estate agent and Zoocasa’s director of business development, said.
“However, there remain opportunities for those that have their sights set on purchasing a detached property in the city’s East and West end.”
Zoocasa’s analysis revealed that of the nine neighbourhoods where median prices were under $1 million in September, four are situated in the city’s West End and the remainder are in Toronto’s East End.
Anders notes that the majority of the homes available under the $1 million mark are older, war-time bungalows, and some two-storey properties in the city’s East End.
And the report notes that this offers a good entry point for those wanting to enter the detached home market.
While the neighbourhoods offering affordable housing is narrowing, it’s good to know some options still exist in the Toronto’s competitive market.