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Investment Real-Estate: East-End Toronto Neighbourhoods Just Shy of Prime

Investment Real-Estate: East-End Toronto Neighbourhoods Just Shy of Prime

East-end Toronto Real Estate has become synonymous with a handful of popular, mature neighbourhoods; namely Riverdale, Playter-Estates and The Beach. Toronto homes for sale in these prime neighbourhoods tend to sell in a matter of days and often well over market-value–even by today’s standards–due to aggressive bidding wars.

Even Leslieville–not long ago, an area still very much in transition–has become out of reach for many buyers looking for updated, family-sized houses. The competition amongst young couples and families for Leslieville homes, particularly those north of Queen and south of Dundas, is incredibly fierce.

So, what’s a frustrated buyer to do when they’re priced out of the market? The answer used to be to buy an un-renovated home, the worst house on the best street, and put in some sweat equity. Nowadays, even original condition homes for sale in Toronto are going for top dollar in prime neighbourhoods.

Your best bet in today’s market? Let your prime neighbourhood dream go for now–it may need to wait until your next property purchase–and buy into the “next big thing” neighbourhood to grow your equity. Waiting and hoping that prices will drop significantly in a prime neighbourhood isn't the best bet for most young buyers. Could prices drop one day? Sure. Are they going to drop significantly so as to completely remove the barrier to entry? And are they going to drop so much that you'll still come out on top by renting in the meantime, not building your home equity? Highly doubtful.

Any market moderation we're likely to see is just that–a moderation in price growth, and most buyers will never outpace property price increases with growth in their annual earnings / savings. So, start growing your Real Estate investment now, while mortgage rates are low, in a neighbourhood that’s likely to see higher than average value appreciation, even if the market moderates. It’ll get you into your forever home in that prime neighbourhood all the faster.

If you’ve found yourself priced out of prime Toronto neighbourhoods in the east-end, here are our picks for the next best things, just on the cusp of prime.

East-End Toronto Neighbourhoods With Strong Investment Real Estate Potential

Our Top Pick: The Danforth

A lot of Toronto Realty hype has been drummed up around areas south of Danforth but there are some really interesting things happening in the east end’s northern pockets. The Danforth, east of Playter-Estates, is a wonderful, family-friendly neighbourhood. Buyers here can enjoy many of the same conveniences of the exclusive neighbourhoods to the west but at a fraction of the price when it comes to property. True, homes on the western border in the coveted Jackman school district often go for top dollar but Danforth homes in the centre of this neighbourhood are incredibly well-priced for what you’re getting.

We also think that homes for sale in Toronto Danforth are a wise investment. There’s been a visible sea change in recent years with older homes being replaced by new builds and builder’s permits posted in the windows of many area homes undergoing extensive interior renovations.

The “but” here, and one of the reasons why it’s priced lower than its neighbours to the west beyond the school district, is that it’s a little further out from the prime commercial strip of Greektown between Broadview and Pape. But Greektown is still within walking distance of most Danforth homes and so you’re really getting the best of both worlds here–lovely, family homes at reasonable prices within walking distance to the best recreational and lifestyle offerings of the east-end.

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Most Underrated: East York

For those who know a little about East York homes, grandma’s outdated bungalow probably comes to mind. For those with a little imagination, your second thought is likely to be huge lots with huge potential.

East York offers some of the best Toronto Real Estate values in the city for detached houses this close to the core. Investors and end-users alike are snapping up bungalows and building up or knocking down and building new. A quick drive around the area reveals so many renovation projects that you can bet property values will rise higher than average here in the coming years. Plus, it’s a great choice for active families being so close to many recreational centres, clubs and parks.

The big “but” here is with transit. We’d recommend this neighbourhood for drivers. If you’re a TTC user, there are buses but it’s obviously not as convenient as being steps to a subway or streetcar.

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Best Investment: Upper Beaches

Change is coming to Upper Beaches Real Estate with the development of multiple new, sleek Toronto condos and townhomes. It’s not surprising really; it was only a matter of time before developers took note of its prime position sandwiched between the Danforth and the Beach, with both trendy Little India and Leslieville just next door.

These new builds are sure to attract a younger demographic to the area and with it, a trendier image. This isn’t a gentrification–the Upper Beaches has long been a wonderful family community with fine homes, tree-lined streets and good schools. This is more of a re-branding; a “hip-ifying” of a once mature, quiet neighbourhood into the next, hot, east-side thing.

The “but” here is that its low on amenities in comparison to neighbouring areas like The Beach and Leslieville and so we can’t give it top marks. Yet. But watch this space. It’s just a matter of time before restaurants and retail follow the hipsters, filling up what little commercial gaps remain along Queen Street East between the main drags of Leslieville and The Beach. Even Gerrard is transforming, with indie coffee shops sprouting up faster than you can say un doppio espresso.

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Special Mention: Little India

Little India made our top picks for young professionals in our where to buy now in Toronto guide but it’s still too “this side of grunge” for some buyers and so it didn’t get top marks overall. Plus, the price increases in the past couple of years have pushed property on some of the most coveted streets like Hiawatha and Rhodes out-of-reach of many buyers.

That said, it still deserves a shout-out because there are some awesome properties here if you’re willing to renovate. Also, we don’t see this area as over-hyped (and therefore over-valued) like some other east end neighbourhoods. Little India is different because it's just a stone's throw from an already prime neighbourhood and from being considered prime itself. In other words, with a location this close to Leslieville, Little India homes are a pretty safe Real Estate investment.

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Lead image: temperature guage by Rob Hyrons from Shutterstock.