The Toronto Real Estate Board recently released their 2016 year in review for the GTA Real Estate market in addition to their prognostications for the year ahead.
Spurred by historically low mortgage rates, a growing populace, generally low unemployment and an economy beating inflation, demand for homes in the GTA resulted in a record high for yearly home sales in 2016. With a total of 113,133 homes changing hands in 2016, this represented an 11.8 percent increase over 2015. This increasing demand, coupled with restrained supply meant that prices in 2016 once again went up with the average selling price of a home reaching $729,922 in the GTA — a 17.3 percent increase over the year prior.
According to the Toronto Real Estate board, the housing market in Toronto is due for another sizzling year. The TREB predicts that for the third year running, over 100,000 homes will sell this year; 110,000 to be exact. While this is a slight decline from 2016’s 113,133, bare in mind that the 100,000 mark is still quite the accomplishment.
How about Home Prices?
Given the fact that demand continues to outstrip supply, the real estate board predicts another significant increase in the price of the average resale home. In 2017, the TREB predicts that the average resale home will record a significant bump from 10% to 16% — resulting in an average price of $825,000 — an approximate increase of $100,000 from the 2016 average of $729,922.
Interestingly enough, the release from the TREB made particular reference to foreign investors; understandably so given the attention garnered by foreign buyers in British Columbia.
According to the TREB’s statistics, foreign investors accounted for only 4.9% of the housing activity in the GTA for 2016.
The report elaborates further…”In fact, the great majority of foreign buyers were purchasing a primary residence, property to rent out, or property for another family member to live in.”
The implication being that these foreign buyers were not purchasing homes merely to leave them vacant and uninhabited.
For many current homeowners looking to move, the persistent increase in home prices and the lack of available inventory might push Canadians towards renovating their existing homes to suit their needs or to look towards other areas.
For potential homeowners looking to get into the market in the GTA, they may decide to seek alternatives such as condominiums which come with a lighter price tag than townhomes, semis or detached houses. Of course, renting or saving for a larger downpayment remains a direction of choice as well.
Regardless, 2017 looks like it will be another exciting year for GTA real estate, as low inventory and burgeoning demand continue to remain at odds.
If you would like to read the TREB’s release in its entirety, please follow the link here.
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