By: Stacy Tseramis & Kayla Scott

January/February 2020 Toronto Real Estate Market Report

Tags: Market Report

January/February 2020 Toronto Real Estate Market Report
 
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Greater Toronto Area REALTORS reported 4,581 home sales through TRREB’s MLS System in January 2020 – up by 15.4 per cent compared to January 2019. On a preliminary seasonally adjusted basis, sales were up by 4.8 per cent compared to December 2019. 

 

We started 2020 where 2019 left off, with very strong growth in the number of sales up against a continued dip in the number of new and available listings. Tighter market conditions compared to a year ago resulted in much stronger growth in average selling prices. Steady population growth, low unemployment and low borrowing costs continued to underpin substantial competition between buyers in all major market segments.

 

The MLS HPI Composite Benchmark price was up by 8.7 per cent compared to January 2019 – the highest annual rate of growth for the Benchmark since October 2017. The condominium apartment market segment continued to lead the way in terms of MLS HPI price growth, but all home types experienced price growth above seven per cent when considering the TRREB market area as a whole. The average selling price in January was up by 12.3 per cent, driven by the detached and condominium apartment segments in the City of Toronto.

 

A key difference in the price growth story in January 2020 compared to January 2019 was in the low-rise market segments, particularly with regard to detached houses. A year seems to have made a big difference. It is clear that many buyers who were on the sidelines due to the OSFI stress test are moving back into the market, driving very strong year-over-year sales growth in the detached segment. Strong sales up against a constrained supply continues to result in an accelerating rate of price growth.

 
CONDOS FOR SALE
 

PRE-CONSTRUCTION MARKET

Supply is not keeping up with the demand for new housing. The annual shortfall has been 5,000 units on average. Completions for 2019 are low due to regulatory changes early in 2017.

Preconstruction prices rose by 10% on average in 2019. The average price for the 416 area is over $1,000 psf. For the 905 area it is about $900 psf. Prime areas are now $1200 psf with Yorkville at $1700. These prices have eliminated resident investors from this market. Buyers are pre-dominantly non-residents or residents with non-resident family money. In addition to demand, increased construction costs and more taxes from various levels of government have added about $400 psf to the current price structure.

Our forecast for 2020 is that the price gap to the resale market (about $300) will slow future price increases to below 3%.

 
CONDOS FOR RENT
 
Featured Neighbourhood

Riverdale

Artsy character with Victorian and Edwardian style homes combined with mature tree-lined streets and easy access to downtown make Riverdale a highly sought after neighbourhood. To the north of this area is Danforth Ave famous for Taste of the Danforth and home to many delicious Greek eateries. To the south, also known as Riverside District, Queen St East is lined with bistros, coffee shops and peppered with independent art galleries. There are 3 major parks in Riverdale and according to the City of Toronto, they will be preserved as green space for many years to come.

Glebe Lofts @ 660 Pape Ave.
 
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