Toronto Neighbourhood Guide

Greater Toronto Area Home Price Appreciation Begins to Cool in Second Quarter of 2017

Jul 13, 2017

TORONTO, July 13, 2017 – The Royal LePage House Price Survey1 and Market Survey Forecast released today showed that home prices across the Greater Toronto Area (GTA) continued to appreciate by a sizable margin in the second quarter of 2017, surpassing levels witnessed in the first three months of the year. In the second quarter, the aggregate2 price of a home in the region reached new heights, rising 24.0 per cent year-over-year to $837,232.

When broken out by housing type, home prices across all housing segments saw notable year- over-year gains. In the second quarter, the median price of a two-storey home in the GTA climbed 24.9 per cent to $987,938, while the median price of a bungalow increased 22.7 per cent to $825,237. During the same period, the median price of a condominium within the region also saw a significant price increase, rising 20.2 per cent to $450,474.

The introduction of the Ontario Fair Housing Plan triggered an immediate slowdown in sales activity across the GTA, as many would-be buyers retreated to the sidelines in order to gauge the potential impacts of the new policies. Just prior to this, the market saw a noticeable surge in listings across the GTA, providing buyers with a variety of new options, creating what appears to be a temporary reprieve from the region’s hyper-competitive real estate environment. While having no immediate impact on year-over-year appreciation within the region, these policies and market factors have helped to temporarily slow price growth on a month-to-month basis.

“Activity in the Greater Toronto Area began to stabilize in the second quarter as more listings came onto the market as a result of a late start to the spring,” said Dianne Usher, senior vice president, Johnston and Daniel, a division of Royal LePage. “While we didn’t see a direct impact to annualized home price appreciation in the second quarter as a result of the new policies, they have led to a psychological pause, with prospective homeowners adopting a ‘wait and see’ approach, sitting on the sidelines in the hopes of a material drop in property values across the region. However, we believe that the hit to consumer confidence will only create a temporary lull in sales activity and anticipate that the region’s seller's market will continue over the coming months.”

Looking ahead to the end of 2017, Royal LePage forecasts that the aggregate price of a home in the GTA will rise by 18.5 per cent year-over-year to $862,264, when compared to year-end, 2016.

1 Powered by Brookfield RPS

2 Aggregate prices are calculated via a weighted average of the median values of homes for reported property types in the regions surveyed

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“Home prices across the Greater Toronto Area are expected to continue rising for the rest of 2017, with year-over-year appreciation slowing slightly, but remaining within the double-digit range,” added Usher. “Prospective homeowners will re-enter the market once they realize prices are not going anywhere and push inventory back to the low levels witnessed earlier this year.”

Greater Toronto Area Market Summaries

Home prices in the City of Toronto witnessed astounding growth in the second quarter of 2017, with the region’s median aggregate home price rising 22.8 per cent year-over-year to $843,590. The area continued to be a strong seller’s market driven by multiple offers across all housing categories.

Prices in Scarborough continued to climb in the second quarter due to an influx in millennials seeking affordable options, relative to many other regions in the GTA. Retaining its position as one of the most affordable and accessible areas within the GTA, the aggregate price of a home in the region rose 21.1 per cent year-over-year to $674,194, with a minimal slowdown in appreciation anticipated in the coming months.

Year-over-year home price appreciation in York Region continued to surpass the majority of markets nationwide, with Vaughan witnessing the highest price gains in the country, posting an increase of 27.5 per cent year-over-year to $1,100,478. Richmond Hill prices also appreciated significantly over the same period, rising 26.6 per cent to $1,334,946. A drop in sales volumes triggered primarily by the introduction of the Ontario Fair Housing Plan, however, was felt strongly in the region, leading to some month-over-month price softness in these costly markets.

Constrained inventory levels pushed prices higher in Markham during the second quarter of 2017, as the aggregate price of a home rose by 25.9 per cent year-over-year to $1,063,022. Looking forward, appreciation within the region is poised to slow, as sellers increasingly place their homes on the market, increasing inventory across all housing types.

Brampton witnessed significant appreciation in the second quarter of 2017, with the region’s aggregate home price rising 23.9 per cent year-over-year to $682,161. Due to the market’s lower price point and attractive property sizes relative to other areas across the GTA, prospective buyers from the downtown core, as well as Richmond Hill and Vaughan have begun to enter the market, causing home values to inch upwards. However, activity within the region has begun to slow in recent weeks, as buyers are increasingly willing to wait and see whether pricing will continue to soften in the near future.

In the second quarter, home prices in Mississauga increased by 25.1 per cent year-over-year to an aggregate of $725,092. Strong demand and a dip in inventory in April resulted in strong quarter-over-quarter price increases, despite the introduction of the Ontario Fair Housing Plan, which slowed appreciation across the area and caused the number of listings on the market to rise in both May and June.


The aggregate price of a home in Milton climbed 23.2 per cent year-over-year in the second quarter of 2017 to $755,116. In April, activity skyrocketed as a result of buyers migrating west into the market, with sellers jumping to list their properties in fear of a slowdown resulting from new policies being introduced in the province. While activity has leveled out over the past month, prices and sales are expected to see a net increase for the remainder of the year as sellers reset their plans to sell lower or take their homes off the market.

Year-over-year home price growth in Oakville continued to climb throughout the second quarter of 2017, with the aggregate price in the region rising 23.7 per cent to $1,088,420. As seen in the York Region, Oakville saw a material drop in sales volumes following the Ontario Fair Housing Plan announcement, and is expected to see slower month-to-month home price appreciation rates, which will likely stabilize in the fall.

During the second quarter, Durham Region continued to see rising house prices due to its relative affordability. Oshawa experienced the second largest gains in appreciation nationwide, rising 27.1 per cent year-over-year to $564,189. Whitby, Pickering and Ajax also saw significant surges, as aggregate prices rose by 23.1 per cent, 22.4 per cent and 22.4 per cent to $698,085, $717,009 and $674,199 year-over-year, respectively.

 

Nationally, Canada’s residential real estate market posted strong home price gains in the second quarter of 2017, with the majority of metropolitan markets across Canada displaying expansionary trends. During the quarter, the Royal LePage National House Price Composite showed that the price of a home in Canada increased 13.8 per cent year-over-year to $609,144. When broken out by housing type, the price of a two-storey home rose 14.6 per cent year-over- year to $725,391, while the price of a bungalow increased by 10.7 per cent to $511,965. Over the same period, the price of a condominium climbed 13.4 per cent to $397,826.

“Following a period of unprecedented regional disparity in activity and price appreciation, we are now seeing a return to healthy growth in the majority of Canadian housing markets,” said Phil Soper, president and CEO, Royal LePage. “The white-hot markets are moderating to very warm; the depressed markets are beginning to grow again. Canadian housing is in great shape – a statement that I certainly did not make last quarter.”

“The rate of national house price appreciation that we experienced in the second quarter continues to be above what we would consider a normal range, driven primarily by very strong year-over-year price growth across much of Ontario,” continued Soper.

Looking ahead to the remainder of the year, Royal LePage forecasts that the national aggregate price of a home will increase by 9.5 per cent in 2017 to $617,773 when compared to year-end, 2016.

About the Royal LePage House Price Survey

The Royal LePage House Price Survey provides information on the three most common types of housing in Canada, in 53 of the nation’s largest real estate markets. Housing values in the House Price Survey are based on the Royal LePage National House Price Composite, produced quarterly through the use of company data in addition to data and analytics from its sister company, Brookfield RPS, the trusted source for residential real estate intelligence and analytics in Canada. Commentary on housing and forecast values are provided by Royal LePage residential real estate experts, based on their opinions and market knowledge.

About Royal LePage

Serving Canadians since 1913, Royal LePage is the country’s leading provider of services to real estate brokerages, with a network of over 17,000 real estate professionals in more than 600 locations nationwide. Royal LePage is the only Canadian real estate company to have its own charitable foundation, the Royal LePage Shelter Foundation, dedicated to supporting women’s and children’s shelters and educational programs aimed at ending domestic violence. Royal LePage is a Brookfield Real Estate Services Inc. company, a TSX-listed corporation trading under the symbol TSX:BRE. For more information visit: www.royallepage.ca.

For further information, please contact: one of the Toronto Neighbourhood Guide real estate sponsors found on this website.

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Parkview Hills Neighbourhood Real Estate Update 2017

Jun 28, 2017

Parkview Hills is a popular family oriented neighbourhood tucked away in a bucolic ravine setting in the area of Toronto known as East York. Homebuyers who stumble upon this neighbourhood are pleasantly surprised by its natural setting, quaintness and close proximity to downtown Toronto. Despite its understated vibe Parkview Hills has not been overlooked by homebuyers in fact just the opposite is true as families scramble to gain entry into this neighbourhood. "The Parkview Hills real estate market right now is shifting just as in other high-demand Toronto neighbourhoods. There is very high demand from buyers and very low inventory which is maintaining high prices", says Effie Panagiotopoulos, Sales Representative at Re/Max Ultimate Realty Inc., Brokerage.

While we read and hear a lot in the media about an influx of foreign buyers into Toronto, Panagiotopoulos says this is overblown when it comes to Parkview Hills which is attracting buyers mainly from East York as well as North York and York Region. Panagiotopoulos adds that; "homebuyers are attracted to Parkview Hills because of its generous size lots which are perfect for building custom homes." Panagiotopoulos lists the close proximity to downtown as well as commuter highways, and the mature neighbourhood landscape as other big drawing cards.

The biggest barrier to entry into this neighbourhood right now is the extreme lack of supply. Only nine homes have been listed and sold within Parkview Hills thus far in 2017. There simply is not a lot of turnover as this is a neighbourhood where people move to raise their families and therefore plan to stay for a while. There is a nice mix of older housing stock including bungalows and detached 2-storey homes that sell in the $1 million to over $2 million price range as well as newer custom homes that sell for $1.8 million and up.

So in a market such as the one we are currently experiencing how does a Buyer secure a home in this neighbourhood ? Panagiotopoulos explains: 'Once a Buyer views a property and loves the home, they should be prepared to immediately submit an offer. "Home buyers should make sure their financing is in order". Panagiotopoulos would like Parkview Hills sellers to know that now is a great time to put your home on the market. In order to obtain top dollar Panagiotopoulos highly recommends you use a local agent who will know how your property compares to other homes on the market and to recent sales so that you can obtain an accurate list price for best results. Panagiotopoulos adds" The power of the MLS to reach a much higher number of potential buyers is very relevant, it gives all buyers a fair chance to know the sellers MLS listing is on the market, available and create wide exposure and interest. This will result in a higher selling price and benefit the Seller."

For more updated real estate information in Parkview Hills contact: Effie Panagiotopoulos, Sales Representative. Re/Max Ultimate Realty Inc., Brokerage. Bus:416-487-5131, Direct: 416-347-0337 or visit her website: http://www.effiep.com/ 

(C) www.TorontoNeighbourhoodGuide.com

Some of the information shown here is complied from source data obtained from the Toronto Real Estate Board. It is presented here for information purpose only. All data are subject to updates and revisions. The author assumes no responsibility for the accuracy of any information shown.

 

RENT GROWTH MODERATES AS SUPPLY STABLIZES

Apr 16, 2017

TORONTO – April 12, 2017:  Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its first quarter 2017 rental results today.

 

The average rent for condo apartments leased through the MLS system increased by 8.3% in Q1-2017 from a year ago to $2.75 psf, moderating from the 11.6% annual growth recorded in Q4-2016. At an average of $1,993, monthly rent levels held steady from the record high reached during the previous quarter. Excluding the impact of new units, same sample annual rent growth was 5.5%, down from 6.8% in Q4-2016. Accounting for the higher than normal growth witnessed in recent quarters, same sample rents have grown by an average of 2.3% annually over the past five years.

 

An improvement in condo supply growth alleviated some of the recent pressure on rents. The 11,315 newly completed condo apartments that reached their final closing during the past six months represented a 33% annualized increase, which stabilized total rental listings as turnover of existing condo rentals continued to decline. As a result, market conditions showed a bit more balance, as the ratio of leases-to-listings edged down to 77% in Q1 from 78% a year earlier, the average days on market increased to 20 from 13 in Q4-2016, and the percentage of units that were leased for above asking rents declined to 9% from 17% in the previous quarter.

 

“Although the rental market remained undersupplied in the first quarter, market forces worked together to temper rent increases” said Shaun Hildebrand, Urbanation’s Senior Vice President. “A return to previous highs for condo deliveries and a rise in purpose-built rental completions are expected to keep a lid on rent growth over the next few years. However, without more meaningful growth in purpose-built rental construction, even greater supply shortages will likely emerge in the post-2019 period.” added Hildebrand.

 

 

Purpose-built Rental Survey

 

Urbanation’s survey of purpose-built rental buildings completed since 2005 revealed that average rents for available units increased by 5.6% annually to $2.52 psf in Q1-2017. Excluding the impact of new completions, same sample rents grew by 2.5%, maintaining a modest pace despite recording an average vacancy rate of just 0.5%.

 

Purpose-built rental development applications increased to a total inventory of 29,360 proposed units, up from 27,812 units during the previous quarter. Growth in proposals has slowed after more than doubling during 2016.  Meanwhile, the number of purpose-built units under construction fell to 5,290 units, down by 8% or 455 units from a year earlier.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

www.urbanation.ca 

Sharp Drop in New Condo Supply Pushing Up Prices in the Core

Feb 26, 2017

Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its Q4-2016 market results recently. Here are the highlights.

 A total of 27,217 new condominium apartments were sold across the Greater Toronto Area in 2016, rising 34% over 2015 to a new high. Remarkably, sales totals topped the previous record set in 2011 on much fewer new pre-construction launches (18,466 in 2016 vs. 28,204 in 2011). Activity ended the year strong with 7,422 sales in Q4-2016, an 18% annual increase. The strength in demand combined with a 6% decline in new launches last year pushed unsold inventory in development down by 47% from the end of 2015 to a more than 10-year low of 9,932 units, which equaled only 4.4 months of supply (a balanced market for new condos is approximately 10 months of supply).

 New condo sales grew the most in the suburban 905 Region last year, soaring 82% to a high of 8,703 units in 2016 and representing a record share (32%) of GTA activity. Sales also increased by a robust 57% in the outer-416 areas of Etobicoke, Scarborough and North York (7,397 units) on higher new launch activity last year, while a minimal 3% gain was recorded in the former City of Toronto (11,116 units) as launches dropped by 40%. The demand-supply imbalance was most acute in old Toronto, where unsold inventory plunged by 57% to 3,503 units, or 3.8 months of supply.

 The overall average index price for sold units in active development across the GTA continued to grow at a moderate annual pace of 3% in Q4-2016 (to $598 psf), which was impacted by the shift in activity to lower-priced suburban markets last year. Within the former City of Toronto, average selling prices within projects launched in 2016 reached $746 psf, up 14% compared to new launch prices in 2015. At the end of 2016, remaining inventory in new projects in old Toronto was offered at $795 psf.

 The draw down in inventory will limit the market’s ability to top 2016’s record activity. Urbanation is forecasting 23,000 new condo apartment sales in 2017, with the expectation that developers will respond to present market conditions by launching a greater number of new projects this year.

 “The new condo market is experiencing broad-based demand that will carry forward in 2017”, said Shaun Hildebrand, Urbanation’s Senior Vice President. “Buyers priced out of the low-rise segment, a surge in rental demand, and increased attention from investors are placing heavy downward pressure on condo inventories, which will support strong price growth this year”, added Hildebrand.

 A record volume of 25,187 condo apartments were resold in the GTA in 2016, rising 22% annually and representing a high of 26% of all GTA resales last year. Sales of resale units in Q4 were up 26% from a year ago, while total listings in the quarter were down 14% year-over-year. This divergence caused the sales-to-listings ratio to hit a record 80% in the fourth quarter (up from 55% in Q4-15), which led prices to grow at annual rate of 16%. At an average unit size of 861 sf, the average resale price reached $458,000, or $532 psf. For the first time, condo apartments represented the majority (59%) of all resale activity in the GTA below the $500,000 price point.

 

 

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

www.urbanation.ca

www.twitter.com/urbanation

 

AVERAGE GTA CONDO RENTS UP 12% TO NEARLY $2,000 RENTAL DEVELOPMENT PROPOSALS CONTINUE TO SURGE

Jan 19, 2017

TORONTO – January 16, 2017:  Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its year-end 2016 rental results today.

 

Highlights

 

The number of condo apartments leased through the MLS system during 2016 in the Greater Toronto Area declined by 2% to 26,602 units, the first annual decline recorded by Urbanation since tracking began in 2011. Rental activity slowed last year on account of occupancy delays for condos under construction, less rental turnover of the existing stock, and an increase in resale activity. Meanwhile, applications for new purpose-built rental development reached 27,812 units, an increase of 7,586 units in the past three months.

 

Despite a 34% year-over-year surge in final closings for newly completed condos in Q4-2016, total rental listings fell by 8%, pulling down lease volumes by 4% annually during the quarter. With resale prices for condos up 15% over the same period, more owners have become enticed to sell their units as opposed to holding onto them as rentals. At the same time, existing tenants have become less willing to move due to the high cost of renting in the open market. The share of the total inventory of condos that was leased last year declined to 8.5% from 9.3% in 2015, while the share of total units resold jumped from 7.1% to 8.1%.

 

Average condo apartment rents shot up by 11.7% year-over-year in the fourth quarter, the highest level of growth ever recorded by Urbanation and a dramatic acceleration from the 4.2% rate recorded one year ago. Part of the increased rate of growth was caused by a shift in lease activity to the former City of Toronto and relatively high rents achieved within newly completed buildings. Nonetheless, same sample rents grew by a significant rate of 7.3%, as the average days on market dropped to 13 — down a full week from Q4-15.

 

“The undersupply of rentals in the GTA continued to worsen throughout the year, causing rents to surge alongside home prices and further deteriorating housing affordability across the region” said Shaun Hildebrand, Urbanation’s Senior Vice President. “While less pressure on rent growth may arrive in 2017 due to a temporary rise in new apartment completions, it’s become clear that more attention needs to be paid to building rentals over the longer-term” added Hildebrand. 

 

Condo Rental Market 

 

Average rents reached a record $2.77 psf in Q4-2016 based on an average unit size leased of 719 sf, equaling an average monthly cost of $1,990. Former City of Toronto rents averaged $2,134 ($3.13 psf), while the Toronto suburbs of Etobicoke, North York and Scarborough averaged $1,857 ($2.47 psf) and the 905 region averaged $1,739 ($2.22 psf). Rents were up the most in the former City of Toronto at 12%, compared to 7% in the Toronto suburbs and 6% in the 905 region.

 

Purpose-built Rental Survey

 

Urbanation’s survey of purpose-built rental apartment projects completed across the GTA since 2005 (49 buildings totaling 8,484 units) reported a vacancy rate of 0.6%, down from 1.0% last year. The availability rate (units that are vacant plus those where the tenant has given notice) was 1.6%, the lowest level surveyed by Urbanation over the past two years. Rents across the sample averaged $2.49 psf, up 5% annually. The inventory of purpose-built projects under construction totaled 22 buildings and 5,133 units in Q4-2016, down by 183 units from the previous quarter and down 1,037 units from a year ago. The total inventory of proposed purpose-built rentals increased to 27,812 units, nearly three times the number tallied a year ago (10,513).

 

 

 

                    

    

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

FOREIGN BUYERS REPRESENT 5% OF NEW CONDO SALES IN GTA Domestic Investor Share at 52%

Nov 2, 2016

  • TORONTO October 27, 2016: Urbanation Inc., the leading source of information and analysis on
    theToronto condominium market since 1981, released the results off ts first ever survey of new
    condominium foreign purchasers and investors today.
     
    In response to the increasing need for more clarity regarding the role of foreign purchasers in the
    GreaterToronto Area housing market, Urbanation expanded its survey of sales activity in new
    condominium apartment projects to include the share of units sold to non-resident buyers as well as
    domestic investors.
     
    Urbanations survey, which is completed by developers or brokerages representing new
    condominium apartment projects, found that foreign purchasers represented 5% of all sales that
    have occurred within projects currently in active development across the Greater Toronto Area.
    Furthermore, domestic investors represented 52% of sales.
     
    Among projects indicating a presence of foreign buyers, shares of units sold to foreign purchasers
    ranged between 1% and 25%. Shares of sales to domestic investors ranged between 5% and 90%.
    The highest shares of sales to foreign purchasers and domestic investors were generally found
    within centrally-located projects in the Downtown Toronto area.
     
    The results of this very important survey show a rather limited role of foreign buyers in the GTA new
    condo market and a very significant overall share of investors. These estimates coincide with the
    percentages of new condos entering the rental market upon completion, indicating the important role
    investors play in the GTA housing market said Shaun Hildebrand, Urbanations Senior Vice
    President.
     
     
     
    Definition
     
    Urbanations estimates were based on a weighted response rate representing 25% of all new
    condominiumapartments sold within projects in development as of Q3-2016. The responses were
    consistent with the distribution of projects across the Greater Toronto Area.
     
    Foreign buyers are defined as purchasers whose primary residence is outside of Canada. Domestic
    investors are defined as purchasers whose primary residence is located in Canada and who do not
    intend on self-occupying their unit(s).
     
     
     
     

NEW CONDO SALES HIT NEW HIGHS Available Supply Drops to Decade Low

Nov 2, 2016

  • TORONTO October 27, 2016: Urbanation Inc., the leading source of information and analysis on
    the Toronto condominium market since 1981, released its Q3-2016 market results today.
     
    A totalof 6,677 new condominium apartments were sold across the Greater Toronto Area in Q3-
    2016, soaring 73% year-over-year to reach thehighest level of third quarter activity on record. Sales
    were 58% higher than the 10-year average for Q3 periods and 12% higher than the previous high
    set in Q3-2007. Total unsold inventory in development plunged by 33% from a year ago to 11,485
    the lowest level since the first quarter of 2007 and representing a record low 5.2 months of supply.
     
    The average index selling price for new condo apartments continued to edge higher, rising 2% from
    a year ago to $590 psf. GTA-level price growth has been weighed down by a shift in new
    development activity to areas outside of the core. Within the former City of Toronto, average index
    selling prices grew by 5% year-over-year to $674psf, while asking prices for unsold units, which
    dropped in number by 48% annually to an all-time low, increased by 12% from a year ago to $759
    psf. Price trends for new condos are beginning to follow the resale market,where average index
    prices grew 12% from last year to $511 psf ($667 psf within the former City of Toronto).
     
    The pace of new condo development has fallen well below the level of demand this year. Given the
    low prevailing amount of available supply and diverse range of buyers, the recent mortgage
    insurance rule changes are anticipated to have a somewhat limited effect on market conditions for
    condos in the near term said Shaun Hildebrand, Urbanations Senior Vice President.
     
    Lack of Supply and Shift in Demand
     
    In the year-to-date to September, a total of 19,917 new condominium apartments were sold across
    the GTA. Over the same period, only 12,189 newunits opened for pre-sales, marking the widest
    divergence betweensales and new supply on record.In total, 90% of the 111,207 units in
    development were pre-sold as of Q3-2016, with 80% of the 30,426 units inpre-construction already
    pre-sold, jumping from a 64% share last year. Among the new units that opened for pre-sales during
    the third quarter, 63% were sold by the end of September one of the highest opening quarter
    absorption rates on record.
     
    In a sign that demand among end-user buyers has been increasing in the new condo apartment, the
    quarterly absorption rate of remaining supply within existing projects launched in previous quarters
    (where owner-occupant purchasers tend to be more active) soared to a record high of29%
    double its 10-year average of 14%. Furthermore, sales of more expensive condo nits have also
    been growing quickly in the resale market, with year-to-date activityup 62% annually among units
    selling for more than $600,000.
     
  •  

Greater Toronto Area Experiences Double-digit Growth in the Third Quarter of 2016

Oct 13, 2016

TORONTO, October 13, 2016 – The Royal LePage House Price Survey1 released today showed double-digit growth in the prices of homes across the Greater Toronto Area (GTA). In the third quarter of 2016, the aggregate2 price of a home rose 13.6 per cent to $693,154 year- over-year.

When broken down by housing type, the median price of a two-storey home and bungalow in the GTA climbed 14.8 per cent and 16.0 per cent year-over-year in the third quarter to $812,990 and $688,813, respectively. Condominiums within the region also witnessed a healthy increase, rising 5.0 per cent to $381,963 during the same period.

The strongest growth during the quarter was found in regions outside of the downtown core, with all but Brampton, Milton, and Mississauga outpacing home price appreciation in Toronto.

“Many homebuyers have continued to look towards the suburban areas of the Greater Toronto Area for affordable housing, as ongoing house price appreciation, chronically constrained inventory and an unprecedented level of demand has priced many purchasers out of the region’s innermost markets,” said Gino Romanese, senior vice president, Royal LePage. “For those focusing their home search within the core, this low inventory, high demand environment has increased instances of multiple offer situations, and caused prices to skyrocket further.”

Recently, the continued outflow of migration from the city centre has spurred a noticeable shift in demographics within many of the GTA’s suburban areas. Regions that once were industrial hubs have begun to gentrify as they transform into commuter cities, housing many young professionals looking for more affordable housing. As a result, house prices in these areas are also climbing. Oshawa, as an example, experienced the largest aggregate price gain of any region across the GTA in the third quarter, climbing 26.0 per cent year-over-year, while ten out of the eleven other suburban areas surrounding the city experienced double-digit price growth as well.

Seller confidence is at an all-time high in the York Region, with Richmond Hill once again experiencing one of the strongest gains in appreciation east of British Columbia. During the third quarter, the aggregate price of a home in the area surged by 25.7 per cent year-over-year to $1,074,829 due to the region’s limited inventory and continued interest from foreign buyers. Homes in Vaughan have also appreciated significantly over the same period, increasing by 13.5 per cent year-over-year to $846,481.

Domestic and international interest continued to drive prices higher in Markham, with many vying for the limited supply of inventory available within the market. Aggressive bids stemming from multiple offers influenced the significant jump in aggregate house price, up 15.2 per cent year-over-year to $870,353 in the third quarter.

Brampton saw its aggregate house price climb in the third quarter by 12.0 per cent year-over- year to $569,510, as many homebuyers continued to flock to the market, confident that prices will continue to rise into 2017. The region’s affordability, stability and close proximity to the city’s core made it an attractive option, placing further strain on inventory and causing numerous bidding wars as buyers continued to attempt to break into the market before it was too late.

Home prices in Mississauga continued to rise in the third quarter, climbing 9.6 per cent year- over-year to an aggregate price of $609,266. The region’s close proximity to Toronto coupled with its relative affordability has led to a heated market where many properties sell within a week of being listed. As a result, prices and home sales continue to climb as inventory diminishes.

Milton to the west, saw home prices appreciate by a healthy margin in the third quarter, rising 10.5 per cent to $613,759 when compared to the same quarter last year. In the past three months, inventory within the region has not been able to keep up with the considerable demand stemming from young families looking to the region for reasonably priced properties. Milton’s inventory shortage has been further exacerbated by a notable shift in the buying process where homeowners are electing to search for properties prior to listing their own as they are confident that their homes will sell quickly.

Low inventory levels across Oakville continued to drive prices higher throughout the third quarter, resulting in a significant year-over-year aggregate price increase of 15.4 per cent to $894,696. While foreign buyers represent a small, albeit growing, segment of the market, they have had a significant impact on prices, aggressively bidding for properties during multiple offer presentations and setting higher benchmark levels for subsequent transactions in the region.

Buyers continued to flock to the Durham Region in the third quarter of 2016 in search of affordable housing and stellar returns on their investment. Whitby and Oshawa saw some of the GTA’s strongest house price appreciation, with the aggregate house price surging 21.5 per cent and 26.0 per cent year-over-year to $590,921 and $453,975, respectively. Pickering and Ajax also experienced a noteworthy uptick in aggregate house prices, increasing by 18.2 per cent and