Originally posted on Canadian Real Estate Magazine by Corben Grant on 25 Nov 2021

The housing market in Toronto has been facing seriously tight supply issues for a few years now and there are more buyers eager for a house in Toronto than there are homes for them to buy. Perhaps you are in this situation and want another way. Or maybe, you just aren’t impressed with the homes on the market and want to design your own dream house.

In these cases, you may have considered building a new house instead of buying a resale home. This is an option that many people take, though it comes with its own challenges. Especially in the city of Toronto, building a home is no simple task, but it can still be done.

Cheaper to buy or build?

In general, you can build a house for a comparable price to buying a home, though there are some additional costs at first. A newly built house is still a house and will still appreciate in value so you will easily get a return on the extra costs in a few years.

However, when you start looking at an area like Toronto, things can get expensive. Unless you are extremely lucky, you should prepare yourself to spend a lot more in Toronto than you would in other areas. This may be fine for those who are willing to drop millions on a custom luxury home, but not so much for the average homebuyer.

On average, it will probably be cheaper upfront to buy a resale home, but if you want a home for cheap you probably should look outside Toronto to begin with.