Has Ajax housing been impacted by the current economic environment? This is an important question for anyone looking to buy property in Ajax, Ontario. In this post, we’ll discuss the state of the Ajax housing market to help you better understand what you might be getting into.
Ajax Housing Market Overview 2020
As of writing, average house valuations in Ajax have jumped considerably, according to Zolo statistics. Between May and June, average house prices rose 8% to $738,000. By comparison, prices fell 2.6% between April and May.
The recent recovery has actually been enough to nudge housing prices back into positive territory for the quarter. While they sat at -2.5% for the quarter between April and May, the most recent period has then at 0.2% in the green.
Of course, this all may not mean much to you if your primary focus is finding a home for your family rather than investing in real estate. While it’s still nice information to have, let’s look at how it affects your buying experience.
Average House Prices In Ajax, Ontario
Currently, a detached three-bedroom house in Ajax will cost you an average of $671,000. A four-bedroom house will run you an average of $910,000. A three-bedroom townhome in Ajax currently costs an average of $634,000 while four-bedroom townhomes will run you about $735,000 on average.
Detached homes are still, by far, the most common types of properties sold in Ajax. The number of sales is often double that of what you’ll find with townhouses and several magnitudes above condominiums.
This reflects the nature of Ajax housing. Nice houses in Ajax are much cheaper than elsewhere in the Greater Toronto Area, which is at least partially responsible for buying preferences. Why cram your family into a box in the sky when you can afford a nice detached or townhouse?
There’s no denying that the housing inventory in Ajax has taken a slump. ‘For sale’ signs have gotten scarcer in some of the city’s best neighbourhoods, with listings falling from 300+ to the mid 100s according to Zolo statistics. On average, Zolo reports that the number of new listings in Ajax has fallen by 53%. Active listings as a whole are down 60%.
While housing has gotten a bit more scarce in Ajax, you can still find your choice of properties in new build communities. Check out this post to learn why new communities are so sought-after among buyers in the GTA.
Time Spent On Market
Homes in Ajax currently spend an average of 38 days on the market, up significantly from the 17 days seen one year ago. It’s not hard to imagine what could be causing this. Canada’s unemployment rate spiked at 13% in May as a result of COVID-19’s economic effects. Experts have stated that buyers “largely retreated” by around mid-March while sellers yanked their listings.
How Ajax Compares To Other Cities In The GTA
Ajax house prices remain considerably lower than what you’ll find in other parts of the GTA. For example, the average price of a house in Toronto proper is currently $931,000 – and that’s after 7.6% was shaved off of valuations this quarter.
Condos are also very much the trend in Toronto, which may not be suitable for all lifestyles. Families, in particular, may find it an inconvenience in light of how much space one can obtain at much fairer prices elsewhere.
Ajax housing prices remain relatively in line with what you’ll find in other Toronto-adjacent cities like Brampton and Aurora. In fact, if you’re not dead-set on living in Ajax (although there’d be nothing wrong with that given how enticing the city is), it’s worth exploring homes elsewhere, too.
Be sure to check out our market overviews for these cities as well:
Is Now A Good Time To Buy A House In Ajax?
Average house prices in Ajax have fallen comparatively low. However, the circumstances that contributed to this decline may still be scaring some prospective buyers away. It’s important to temper these emotions with actual market data. We know that jobs are starting to come back rapidly in Canada and the United States, heralding what some consider to be the start of an economic recovery.
Judging by how prices have seen a spike as of late, this may be fuelling the return of demand for housing in Ajax. However, some property buyers may be concerned about their future job prospects or even whether the economic recovery will last.
It’s important that you speak with an advisor about your specific situation before you decide whether the current market is something you’d like to wade into. At Paradise Developments, we’ve partnered with Scotiabank mortgage specialists to help our clients analyze their financial situation.
Mortgage regulations in Canada are quite strict. This is part of the government’s attempts to avoid homebuyers overextending themselves with the help of banks, which is what happened during the 2008 financial crisis. If you’re able to pass the rigorous stress testing that all mortgage applicants go through in this country, you may find it easier to relax about making such a large purchase at this time.
It’s also helpful to put this year’s house price decline into perspective. It’s easy to forget that Canadian property valuations were red hot prior to COVID-19, prompting experts to warn of a potential bubble long before the now-famous virus was even a lingering thought. RE/MAX has put the current market in perspective based on these prior valuations, pointing out that it may represent a long-anticipated correction rather than a catastrophic aberration in otherwise steady growth.
Are You Buying A Home Or An Investment Property?
The fact remains that Ajax is one of Canada’s fastest-growing housing markets. It remains the third-fastest-selling market in the GTA.
If you’re investing in your family’s future via a permanent residence, current market fluctuations may not be as impactful as you think. In other words, if you buy a house now, a temporary reduction in value next year (which is not even certain but let’s think worst-case-scenario here) won’t mean much if you don’t plan on selling for 10 years. Sure, you could have waited and gotten a better deal. But pro tip: people rarely recognize good deals when they’re here. If you need a house, you need a house. Work with an advisor like the ones we offer at Paradise Developments based on your current circumstances rather than the future’s unknowns.