Patrick Rocca
Good morning, Jeffrey, happy New Year. I think we can still say that. I haven’t talked to you since the end of last year, but is, yes, Patrick Rocca from Bosley Real Estate here in Midtown, Leaside Davisville area, and yeah, I’m here for all your real estate needs.

Jeffrey
Thank you. And Patrick, I just noticed an article which said that the new home prices in the GTA slid even further at the end of 2025 and they were down about 25% from the peak. Now, people may look at this and if they’re in the market for an existing home, not a new build, they may think that this is a fantastic sign for them. But if you could please tell us the difference between these stats in new home builds versus what’s happening in the resale market.

Patrick Rocca
Yeah, no, I’m happy to address that. I can tell you, unequivocally that, you know, new homes are not, plentiful, in the, in the midtown area. I mean, you do get infill housing, bungalows that have been torn down, and obviously these newer, custom built homes that are being built, but I think in general, if you look at new home construction, it’s not as prevalent as the resale market in, especially in the central core. there are, there are several newer built homes. but interestingly enough those are the homes that are lagging. when you look at the market in general, specifically in my area, newer homes that were built in the last year or so are kind of just sitting there.
I think we might have addressed this before in a, in a past podcast where, you know, the problem with those homes is that the builders bought them, you know, 3-4 years ago for at the peak of the market. I mean, they were paying $2,000,000 for a bungalow that’s worth 145 today. Carried, built during COVID, during the last couple of years where construction costs were extremely high. and are now in a position where they have to sell them for, let’s say, $4,000,000 plus and they’re actually worth $3.235 million. So, I mean, I can see that, being you know, obviously a factor in the new home sales, but I mean, I think in, if you take new home sales in general across the GTA. I mean there hasn’t been a lot of new home construction. I mean, I think that has really dwindled, from what I’m seeing and hearing. and I think that all goes back to, you know, you know, if we could talk about a housing crisis and you can talk about, you know, new homes being built, but they’re not being built because of, you know, the fees and all the development charges and the time it takes to get approvals. I mean, you know, we talked about, you know, ‘build baby build’, you know, with our, with our new incoming government, and there’s been nothing done. Literally, there’s been no building. and why is that? Well, I mean, you’ve got municipal, you know, barriers, you’ve got provincial barriers. You’ve got taxes, you’ve got, it’s just awful. I mean, I think I read something. And don’t quote me on this, but I’m pretty sure it’s fairly accurate. About a week ago, I read something that to build a home in Toronto. The fees and all the taxes and everything, the charges, add up to about a $100,000 per house. In Moncton, New Brunswick. It’s $10,000.

Jeffrey
Wow.

Patrick Rocca
So I mean, figure that out. I mean, it’s not, doesn’t take a rocket scientist to figure out that, the cost to build, and the barriers to build, and the, you know, it’s just, it’s not, it’s crazy, and what are we doing? The government’s doing nothing about it. This goes back to the government. This goes, and it’s not just, I’m not talking federally. I talking provincially. I’m talking municipally. I mean it’s just, we are not, you know, we’re we talk a good talk. And we say, okay, let’s build, and we need affordable housing, and we need this, and we need that, but no one’s doing anything to assist in the pipeline.

Jeffrey
And I think that, you know, back in the 80s and 90s, even before that, those of us who are old enough to remember, the federal government had an active part to play in constructing housing, especially affordable housing. Now, they’ve stepped away from that a number of decades ago. And as you say, the only levers they really have are policy levers and the levers that you talk about in terms of things like taxes and fees. I heard a condo developer speaking the end of last year and again, don’t quote me on this. They were saying that up to 30% of the cost of a condo development in an urban area are taxes, fees, levies, that sort of thing, not construction costs, not land costs, but everything else that’s required just to get a shovel in the ground.

Patrick Rocca
Yeah, that numbers, I think I recall maybe even discussing with you or someone else and hearing that, but it’s fairly accurate. It’s ridiculous. And that’s why, I mean, we are, we are in a, in a serious crisis right now. you know, we have a housing crisis in our in our country. and that’s one of the main reasons. So, I mean, it’s sad. I mean, so I mean, how does that, you know, go over to the resale market, as you had mentioned, you know, how do they, how are they similar or how are they different? Well, I mean, the resale market is down too. I mean, let’s be honest. I mean, if you look at the resale market, compared to 2-3 years ago, we’re down about 26% in value. at from the peak. so, I mean, if you look last year, we were down 6%, you know, year over year, so, I mean, what’s, people, again, this goes back to our economy, and this goes back to consumer confidence, and this goes back to, you know, what will it take to get our market going again? And that’s the $1,000,000 question. I mean, it’s not, you know, I think it’s going to be a fairly rough year. again. you know, they’re projecting, and I read something of Royal LePage article that said that you know 2026 will be a recovery year. I don’t see it short term, for sure, it ain’t, it ain’t happening short term, long term, maybe towards the end of the year.
There could be some movement, but I mean, our economy is not in good shape. I mean, we, this all goes back to consumer confidence, uncertainty. People don’t know what’s going on. I mean, I hate to be Debbie Downer, but it’s a reality. I mean, I’m not going to be one of these realtors that says, Oh yeah, everything’s great. I mean, that’s not the way I am. I mean, I do, however, you know, I am the glass is half full type of guy. I do believe there are great opportunities in this market. If you’re a buyer. You know, you should be buying.

I mean, the rates are low. They’re not going to go much lower. I’m, going on here, but you know, rates aren’t going to go much lower. If anything, there’s been talk that they could have bottomed out and that they will maybe increase towards the 4th quarter. So, I mean, I don’t know what buyers are waiting for. Is the market going to drop another 34%, it could.. Is it gonna drop 10-15%? I don’t see it. Is it off 25, 30%, 100%? So why wouldn’t you buy? I mean, are you trying to predict the bottom?
And again, I’ve said this 1,000,000 times to you and to others. You can’t predict the bottom. you can’t predict the top. So if you’re buying, it’s a great time. If you’re selling people have to sell. Everybody has to sell for various reasons. or not everybody, but people have to sell for various reasons. I mean, whether it’s death, whether it’s separation, whether it’s, you know, moving out of town, whether it’s, you know, there’s all sorts of factors. So if you’re selling, yeah, you’re not getting what you were going to get 3 years ago, so be realistic, but your house will sell. I mean houses are selling. it’s not all doom and gloom. they’re just not selling for what they were 3 years ago, and if you’re waiting for that, you’re gonna wait a long time, you might as well hunker down for another 3 to 5 years because, we’re not going to see those numbers again.

Jeffrey
I agree. And I was talking to a couple last week who are actively looking in the market. They’re looking in, you know, the various areas in Midtown, Toronto, in the core, and they’re very frustrated because they’re facing instances where they do get multiple offer situations. They were telling me that they had put an offer in on a house in East York and someone came in and offered $400,000 over the asking price. And I think that there is a lot of frustration, there are houses. But what they’re finding, and you know, this is their experiences that they’re looking for something which is maybe requires a bit of work, but they’re having challenges finding that. Are you finding that there is a lack of inventory of those houses, which maybe require a bit of work? I’m not talking about a full, like, tear down, but maybe that requires, you know, walls removed, basement finish, that sort of thing. Are you finding that there are less of those on the market?

Patrick Rocca
Yeah, there is a bit of a, there is a bit of a lack of that inventory and you’re right. I mean, you know, you’re talking about these people that were in multiple offers. We’re still seeing multiple offers. I mean, there’s been instances that I’ve seen in the past 2 weeks where properties are selling for over asking. so, I mean, is that coming back? No, is it prevalent in certain price points in certain homes? Yes, East York being one of them. so, I mean, you know, I think that, to your point. Yeah, it’s hard to find raw product. I just listed something this morning. That’s a, it’s a great, a great bungalow in South Leaside, and I mean, is it, is it raw? No, I mean, does it move in? Yeah, does it need updating? 100%. But it’s got great potential, and hopefully, you know, that will sell. But you’re right. I mean, even though there is more inventory now than there has been, a lot of that is not raw or stuff that is, you know, in need of renovation.

Jeffrey
So essentially, they could move in and do the work as they are able to finance it, which in a lot of cases for new buyers, for 1st time buyers, that’s really an ideal situation where, you know, you can bid up to a certain point, you can kind of live in the place, find out really what it’s like and then do your renovations afterwards.

Patrick Rocca
Yeah, 100%. I mean, that’s what this house is. I mean, and it’s got, you know, an, like a, an in law suite in the basement. we did a garden suite study. You can build a big garden suite in the backyard with income. This is a really good income property and or property for a 1st time buyer who maybe wants to, you know, rent a basement, have an in law suite. I mean, there’s all sorts of potential in this property.

Jeffrey
And that’s interesting that you brought up the fact that there are, that’s, other dwellings that are possible on a property, right down the street from us, they’re putting up a laneway suite that’s got 2 suites in it. So, something on the order of increasing it from a single-family home with a garage to at least 4, maybe 5 units on the property.
And, you know, when it came to Committee of Adjustment, the messaging that people on the call were getting is that the city is very flexible, let’s say, in, adjustments and in terms of, alterations for any property, any proposal which increases density allows for multi, units on a formerly single family house.
So, they even allowed for a variance for overheight and for backyard setback. So I think the city is in the policy part for individual projects is allowing for that. But as, you know, as we’ve seen, that’s only a single project that’s increasing from one to maybe 5 the number of units, and that’s not really going to make a dent.

Patrick Rocca
Yeah, we’re seeing that, there’s one actually on Eglinton and Leaside, the similar sort of thing, it was a bungalow and they tore it down and they built, I want to say, 4 or 6 plex, and they went for, variants to get a garden suitein there as well and I’m not sure if they’ve got that yet. Unfortunately, the developer, the builder did everything without permission.

Jeffrey
That’s the same developer.

Patrick Rocca
Oh, is it? Okay. Yes. I mean, apparently that’s the MO of this builder. you know, they do what they do and then they ask for forgiveness and in this case is that’s what happened. It, quite frankly, it’s a, it’s a bit of an eyesore, but I mean, yeah, you’re right. I mean, the city is, the city and the province is approving these things and that’s what’s happening, right?

Jeffrey
Now, the other side of the fence is, again, looking at, you know, what can make resale housing more viable for 1st time buyers. And the amount is, you know, kind of still eye watering when, you know, somebody looks at what’s required or the average resale home in the GTA, not just in the midtown area, but in the GTA, the number’s been over a $1,000,000 for quite a few years. So, in that, are you seeing that some of your buyers are looking at more flexible options, you mentioned that some of them have a suite which can be rented, maybe there’s an accessory unit, which could be built later on. Or even, co-ownership where, you know, somebody might go in with some friends or, you know, family members to, you know, subdivide a property to be able to increase the affordability. Have you seen anything around that in the market?

Patrick Rocca
Not much on the co-ownership, however, I have heard of it, through some of my peers and colleagues. but the definitely the potential to have income. the potential to have, you know, a 2nd suite. obviously, that those are all factors, I think, that, are very appealing to, specifically to 1st time buyers, that, the thing with a garden suite, is, as you know, they’re not cheap to build, right? So, I mean, if you’re, if you’re paying a, you know, $1,300,000 for a property and it’s got income, which is great in the basement, you know, you potentially rent it out if it’s legal. and if, but if you want to build that garden suite, it’s, it could be another half a million as you know, right?

Patrick Rocca
So, you know, there’s, you know, there’s prefab ones that you can buy for 250 apparently, but, yeah, there’s people looking at those options for sure, and it’s definitely more appealing, especially, to a 1st time buyer.

Jeffrey
Yeah, and of course, you know, for affordability, we’ve always talked about things that, you know, people can do to, I guess, maybe ease the pain a little bit, that we talked earlier about, not necessarily buying something, which is completely done.

And I know from discussions, I’d say literally 3 quarters of people that I’ve talked to have challenges, seeing potential, you know, even if it’s something like paint or bad lighting. And I think that the other side of that is that, you know, working with somebody who’s in the neighbourhood, who can advise you on these things, you know, be able to give you some perspective on what something could be with maybe a new code of paint or, you know, updated fixtures, as well as understanding the different projects coming up in the neighbourhood, for instance, in my neighbourhood, at the corner of Mount Pleasant and Davisville there’s an office building, which for years was rumoured to be underdeveloped, and last year, finally, we did get the development notice that there’s going to be a 12 story condo put on that spot.
Now they’re probably not going to start construction for about 3 years. However, if you’ve bought a house, which is adjacent to that property, you’re a new home buyer, wouldn’t you want to know that something eventually might block your view or there might be construction disruption? An agent from another part of the city might not know that.

Patrick Rocca
Yeah. And I mean, I think, I know a building you’re talking about the northeast corner, if I’m not mistaken, but I mean, the bottom line is I mean, I think, as a buyer, and as an agent, you have to kind of assume,. Now, in this current market economy, that anything close to a busy street, Mount Pleasant or Bayview, as in one or 2 houses in or a Laird or a Brentcliff, or, it doesn’t matter what’s there now. What’s going to be there in the future is going to be totally different and you have to just assume that. and I think that goes without saying, so, I mean, yeah, I mean, I agree with you, and it, you know, experience and knowledge of the, of the marketplaces is very important.

Jeffrey
I agree. And it’s sometimes a little bit, I don’t know, maybe disruptive for somebody looking for a home to have a different agent in every different area they’re looking in. but, you know, what are the advantages of that? For somebody is looking very focussed in, say, Leaside or Davisville to have an expert on that area.

Patrick Rocca
Well, it’s very important. and again, it’s, I mean, if you don’t have to have I mean, like when I say, you know, obviously I specialize in Leaside or Davisville. I sell, obviously in other areas, but if you come to me and say, Patrick, I want you to help me in Etobicoke, or I want you to help me in Mississauga, or I want you to help me in, you know, Thornhill. I won’t do it, because I don’t know the area.

As a matter of fact, I just referred some people to a colleague of mine in Thornhill last week, who are looking at buying. I refer to my network of colleagues, you know, almost, you know, a couple of times a month, because I just don’t feel comfortable.

You will get agents who will go, you know, and go to Hamilton, for God’s sakes. I mean, who does that? I mean, I don’t know what’s going on in Hamilton, let alone, you know, the far western part of the, of the city. so I just, you know, I know Toronto. I know Leaside Davisville. You know, I know Midtown. you know, I know East York. I mean, so I know those areas, but once I get beyond my comfort zone. I’m not the greedy person. I’m more. It’s more important to me to make sure that my client is, treated properly and professionally and has works with someone who has a knowledge of the area.

Jeffrey
Absolutely. And as we’ve discussed, you’ve been doing this for over 30 years and seen a lot of technology come in, a lot of changes in the marketplace, but, you know, that experience, it does count for something. It’s not just in the negotiation technique. It’s not just in, you know, finding deals. It’s really understanding the process and for a 1st time home buyer, I can speak as one. They were really challenging times. I did not know, what was going to happen, and I was really glad I had somebody knowledgeable to really guide me through the steps.

Patrick Rocca
Yeah, absolutely on 100%.

Jeffrey
Fantastic. So, Patrick, why don’t we leave it there? and if folks are trying to get a hold of you, What’s the best way for them to actually contact you?

Patrick Rocca
The best way obviously is through my office here in on Vanderhoof. my direct line. if I’m not in, just leave me a voicemail. I call you right back, it’s 416-322-8000. obviously, my email is probably the best because my phone, as I’ve mentioned, is attached to my body. It’s mail@patrickrocca.com

Jeffrey
Oh, fantastic. Well, as always, Patrick, it’s an interesting year so far. We’re about a month in and we will definitely touch base a little later on and see what’s happened in the spring market.

Patrick Rocca
Yeah, it’s gonna be. I think it’s going to be interesting as, you know, as you said, we’re a month in and the spring market is just starting up and, you know, I’m just starting to sign up listings and whatnot, so the, I guess the next step will be to see is, will they sell and when will they sell.

Jeffrey
Yeah, absolutely. So, looking forward to our next chat.

Patrick Rocca
Thank you very much, Jeffrey. have a great day. Stay warm.

Jeffrey
Thanks, Patrick. Bye.