I recently sold a condo townhouse and during the selling process I had some very interesting conversations. A comment made by a renter who was looking at buying a home was that they felt condo townhomes would not increase in value like semi-detached or detached homes would, so they wrote the townhome off. The comment made me wonder if there was any truth in that idea. I did a bit of digging and found some interesting information.
I looked back over the past 10 years and compared the increases of condo townhomes, detached homes along with semi-detached properties. Here is what I found:
| May, 2013 | May, 2023 | |
| Condo Townhomes | $156,000 | $658,000 |
| Detached Homes | $317,000 | $927,000 |
| Semi-Detached Homes | $217,000 | $775,000 |
The average of all home sales in Durham Region has increased from $342,000 in May 2013 to $1,084,000 as of the end of May 2023! This is an increase of about 320%. That is quite the increase in values! When I broke down the increases into the different types of properties, I found some similarities and some data that showed the “renter” had their thoughts on townhomes a bit skewed.
Condo townhomes increased by about 420% over the past decade with detached homes increasing by 300% and semi-detached homes by about 360%. One difference is that to purchase a townhome a decade ago you would need a much smaller downpayment than either a semi or detached home. A 20% down payment on a townhome would be $31,200 compared to the down payment of a detached home of $63,400 and with half of the amount invested for a down payment, the investment in a semi-detached home paid off far more than for a detached home.
Since I have been helping Buyers and Sellers navigate the home buying process, a common theme I have heard is that many feel that detached homes outperform all other types of properties when it comes to return on investment. This line of reasoning has never proven accurate. There is no question that all forms of housing have increased dramatically over the past decade, however the entry level homes seem to have always been the best investments. If we go back in time, here is what has happened to the average price for a semi-detached home in Oshawa:
May/2000 $125,000
May/2005 $171,500
May/2010 $181,000
May/2015 $269,000
May/2020 $461,000
May/2023 $775,000
The values have consistently increased, with a dip in values last year being the only time we have seen any decline in prices. What this presents is an opportunity for Buyers and investors to get into the market at the lowest values in a year. The rates are up, however if history repeats itself, the rates will relax and come down as inflation recedes and the values will continue to rise.
Success leaves a “bread crumb trail” meaning that by looking at what has happened to Real Estate over the past decade we get a glimpse of what is may be coming. With the average semi-detached home in Oshawa at $775,000 and a 360% increase in value over the past decade, is it conceivable to think by 2033 semi-detached homes will be selling for $2,790,000? As crazy as this might sound, if you were asked a decade ago if semi-detached homes would increase by $560,000 would you think that was a possibility? I have learned when it comes to Real Estate anything is possible.
If you are planning to buy a home for the first time, a rental property or interested in selling a property you own, I can be reached at lindsay@buyselllove.ca or 905-743-5555
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