Top 5 Problems with Owning a House in Toronto

The only thing we do at Advantage Group Real Estate is real estate. We sell property, help people purchase property, and train agents to do those two things. Our lifeblood is Toronto real estate. But if we're going to be completely truthful, owning a house in Toronto isn't always the right move for everyone.

This blog will discuss five problems with owning a house (not a condo) in Toronto.

Problem 1: High Maintenance Costs

Owning a house in Toronto brings the challenge of dealing with Canada's extreme weather. The weather can lead to heavy maintenance costs you must be ready for. Let's break down what this means for homeowners.

The Freezing Winter:

Toronto's winters are famous for their bitter cold and heavy snowfall. This kind of weather is tough on a house. For example, the weight of snow can cause damage to roofs. Ice dams can form at the edges, preventing proper drainage and leading to leaks. Then, there's the need for regular snow removal to avoid walkway or roof damage accidents. And let's remember the absolute mess that sidewalk salt can have on carpets, floors, and walkways in your house if you're not extremely careful about where you remove your boots.

Plumbing Perils:

Freezing temperatures are a nightmare for plumbing. Pipes can freeze and burst, leading to severe water damage if you forget to winterize your house (this can mean tearing down walls, dealing with mould, and doing much renovation work).

Summer Strains:

Summer brings its challenges. High temperatures and humidity can wear down your house's exterior, fade paint, and strain your cooling systems. Keeping your home cool during Toronto's hot summers means your air conditioning system needs to be in top shape, which can be costly to maintain and run.

Continuous Upkeep:

Beyond seasonal challenges, there's the constant upkeep. Regular tasks like gutter cleaning, window repairs, and maintaining your lawn or garden add up in terms of time and money.

Many of these issues are handled in a condo through your maintenance fees. They have professionals on hand to manage these problems. But as a house owner in Toronto, these responsibilities fall entirely on you. It requires a budget for repairs and maintenance and, sometimes, the skills and time to handle minor repairs yourself.

Anyone thinking about buying a house in Toronto should consider this aspect of homeownership.

Also, if you think, "Hey, screw it, I'll just let it all fall to pieces around me; I'm only here for a few years anyway," think again. If you neglect the maintenance of your house, the city can and will take matters into their own hands and flip you the bill.

If the thought of high maintenance costs sends a shiver down your spine, buying a house in Toronto might not be for you. This is particularly true for those who need more financial support for the unpredictable and often hefty house upkeep expenses. If you prefer a more predictable budget or don't have the time and resources to deal with regular maintenance and sudden repairs, a house might bring more stress than satisfaction.

However, for those who are financially prepared and willing to invest time in upkeep, owning a house in Toronto can be deeply rewarding. If you enjoy the satisfaction of maintaining and improving your property and have the means to manage the associated costs, a house offers a sense of accomplishment and a personal touch that other types of properties might not provide. 

Problem 2: Tax

Understanding the property tax landscape is important for those considering buying a house in Toronto. Interestingly, Toronto's property taxes are relatively lower compared to other major cities, which might initially seem like a plus.

But, there's a catch!

The Municipal Land Transfer Tax (MLTT). This tax, unique to Toronto, applies when you purchase a property. It can significantly increase the initial cost of buying a house, especially given the high real estate prices in the city.

The MLTT is calculated based on the house's purchase price, and in a market like Toronto's, this can add up. Buyers should consider it when budgeting for a house in Toronto.

Additionally, it's important to note that property taxes in Toronto are set for an increase in 2024-2025. Although the current rates might be lower, the planned increases mean that the long-term cost of owning a house in the city will likely increase.

The combination of lower ongoing property taxes, the significant one-time hit of the MLTT, and the expected future tax increases forms an interesting financial landscape, to say the least.

If additional taxes and future increases concern you, you might want to reconsider your house buying plans. The Municipal Land Transfer Tax (MLTT) and anticipated property tax hikes require financial preparedness, especially for those stretching their budget to afford a house. For those unable to comfortably handle these extra costs or prioritize financial stability, exploring other housing options like condos or rentals might be the play. Understanding your financial limits and comfort levels is essential for aligning with your lifestyle and future economic health.

Problem 3: Limited Appreciation

When considering buying a house in Toronto, it's hard to ignore that property in the city usually appreciates with time. However, this appreciation doesn't uniformly apply to all areas of the city.

Certain areas of the city might not appreciate at the same speed as others, for various reasons. Factors influencing this include the location, access to essential amenities such as parks, transit, schools, shopping, and even the quality of services, schools, and community.

The rate at which property appreciates can significantly impact your house's long-term investment value. Depending on where you purchase, you may not see the ROI you expect from owning a home in Toronto.

This means that you'll need to thoroughly research your target neighbourhoods to understand the real estate trends over the timeline you've established for yourself. 

The outcome of uneven or underperforming appreciation can be a significant sticking point, especially if you think you will only be in your property for a short time. 

If your desired neighbourhood isn't appreciating at a rate you're comfortable with and don't think you'll be there for a long time, then renting may be a better option.

Suppose your neighbourhood is appreciating at a rate you're comfortable with or you intend on staying put for a while. In that case, buying a property can significantly increase your net worth.

Problem 4: Lifestyle Constraints

Owning a house can impact your flexibility regarding relocation for job opportunities or significant lifestyle changes. Unlike renting a property, where it's relatively easy to end your lease, owning a house ties you down to your location. This can be a problem if unexpected life events or job opportunities that require you to relocate pop up.

Another consideration is the logistical complexities associated with selling a house. In slower markets, selling a home is more challenging than many think. It can take considerable time and effort. It's a multi-step process that begins with preparation, involving minor repairs or major renovations. When selling a house, you also want to consider the season you're selling so potential buyers can view the property during the best days of the most admirable seasons. Often, this process alone can take months.

Are all of these things requirements? No, not at all, but they should be considered. 

After preparing the house for the market comes the process of presenting it for marketing, staging it, photographing it, and filming it, which can take 1-2 weeks.

Only then is the house listed on the MLS. In slower markets, it can sit on the market for months.

In contrast, moving out of a rental is a much quicker process. The length of notice changes based on circumstance, but a good rule is 60 days' notice. It's also common for a landlord to let tenants out early based on a simple conversation. If you need to go, have the conversation with the landlord.

If you have a busy, uncertain lifestyle or like change a lot, then owning a house might not be for you.

On the other hand, owning can be a great way to lay roots in your community if you're stable and TO is your long-term home.

Problem 5: Space and Privacy Concerns

Owning a house is usually associated with having more space and privacy than a condo or apartment. You get a yard and fewer neighbours, right? That should mean more personal space and seclusion; however, this isn't always how things go in the dense urban jungle of Toronto.

In Toronto, demand for real estate is high, and space is at a premium. Due to the limited availability of land, houses in popular, sought-after areas are typically built in close proximity to each other, diminishing privacy and outdoor space.

The outdoor space that many typically associate with owning a house, such as a spacious backyard for the kids to play in or for hosting outdoor gatherings, may be smaller than anticipated in homes in Toronto.

If you're not expecting limited outdoor space, it can be perceived as a big reduction in one of the key advantages of buying a house.

Next, let's consider the proximity to neighbours. In most areas of Toronto, you'll be close to your neighbours. People who value privacy and outdoor space might be less attracted to purchasing a house in Toronto.

Owning a house in Toronto can offer more space and privacy, but that space and privacy are only sometimes guaranteed. Toronto is urban, and urban planning and high demand mean less space and less privacy.

Purchasing a house in Toronto might be the wrong decision if you require guaranteed space and privacy.

In conclusion, owning a house in Toronto can be challenging due to high maintenance costs, property taxes, and your lifestyle. While it can be an enriching experience for those who are financially prepared and willing to invest time in upkeep, some may have better choices. 

Ultimately, you must consider these factors before buying a house in Toronto and explore other housing options that align with your lifestyle and financial limits. Finally, deciding whether to own a house depends on your priorities, goals, and comfort levels.

If you're the type of person who thrives in an urban environment, takes pride in caring for a house, has resolved that Toronto is home, and is comfortable with the risk associated with their immediate market, then owning a house in Toronto can be an enriching experience that pays off financially and personally for a lifetime. 

The key here is to know yourself, ask yourself the hard questions, and only then decide if a house is for you.