I invite you to check out my article, which shows a graph of Toronto real estate average prices since 1953. To allow a clear picture of the fluctuation of property values, these average prices have been corrected for inflation.
In the video published on December 10th, 2016, Toronto Real Estate Board Senior Manager, Jason Mercer, discusses real estate sales in the Greater Toronto Area in November. By the end of November MLS sales were already higher than in all of 2015.
While lower than in the summer - in part due to the low listing inventories - November sales were still stronger than in the same period of 2015. 8,547 properties of all types were reported sold on the MLS system in November, 1,210 (or 16.5%) more than last year. The strongest increase in sales was for townhouses and condominium apartments.
Many prospective buyers were unsuccessful in their search for property and frustrated with a lack of listings. The competition for existing listings caused multiple bids on offer dates, and contributed to a substantial price increase. The MLS home price index composite benchmark rose by 20.3% over the level in November 2015. The average selling price was $776,684, an increase of 22.7%.
Home price growth is a function of supply and demand. Recent policy changes focus on the demand portion of this equation, but more emphasis should be placed on alleviating the low supply, especially in the low rise market segment.
Toronto Real Estate Market according to TREB's Mercer - 2nd quarter 2016
In the next video released on August 11th and running under 8 minutes in length, Jason Mercer discusses the real estate market in the first half of 2016, and provides a forecast for the remainder of the year. Mr. Mercer talks about a strong growth of MLS sales in Toronto and surrounding area. Sales of properties of detached, semi-detached and attached homes, condominium townhouses and apartments have increased by slightly more than 9%, compared to the same period a year earlier. Current pace of real estate sales will likely lead to the second consecutive record year.
Demand for houses, Mr. Mercer says, is sound, with the Greater Toronto Area economy performing better than other metropolitan areas across Canada, and the average income growth above the inflation level.
With very low inventory levels we have seen a strong price growth in all segments of the market, due to competition between prospective buyers. Shortage of listing inventory was, at least in part, due to the reluctance of existing owners to list their property for sale while it is not certain they would be able to find a property meeting their needs, prompting many home owners to stay and renovate, instead of selling. Sales to new listing ratio has been extremely high, at almost 71 percent.
For the first 7 months of 2016, the year-over-year price growth for properties of all types was over 15%. Detached house prices increased by 18.7%. Condominium apartment prices went up by 7.8%.
We don't expect the supply and demand in the real estate market to change over the remainder of the year. Borrowing costs are expected to remain very low, and there is no relief in sight where it comes to supply. Average selling price increase for 2016 is likely to be more than 15%.
Mr. Mercer also addresses the concerns over the strong price growth in all segments of housing, and discusses some actions the government can undertake to ease that growth, including the tax for foreign buyers imposed in British Columbia at the beginning of August.
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