Toronto Real Estate Market Update February, 2021
The real estate market in Mississauga and the Greater Toronto set another record in January of 2021. Over all, sales were up over 60% compared to the same time last year and prices were up 15% for all home combined.
The biggest gains for home sellers were found in the single family segment in the suburbs, where some areas posted 30%+ increases year over year. This trend of of buyers moving from the city to suburbs such as Oakville has continued from 2020.
Check out this article for buyers looking to move from Toronto to Mississauga.
While condos continued to underperform compared to houses, there may be a silver lining for the Downtown Toronto market. While prices have been stagnant and even gone down in some areas, sales were up which could hint that a rebound is not too far off.
Check out my video on why I remain confident in Toronto Real Estate Market Prices in the future, and why you should too!
Transcript: Is the Toronto Real Estate Market Heating Up too Fast?
Well here we are, another record-breaking month for Toronto Real Estate in January 2021, we reported over 50% more sales than the same time last year
the market has continued to be red hot, and continued where we picked off the year before and that’s because of a low inventory and high buyer demand.
When we look at the pricing side of things, prices for all properties have gone up on average over 15% in the GTA
and when you break it down by different areas you can see certain areas have gone up even way more reflecting the trend of people still continuing to leave the core and go out into the suburbs in order to find single detached family homes
Now as I’ve been predicting in my previous videos and since the summer time of 2020 this trend will continue because we do have a lack of inventory in our market
not enough supply coming online and I still think you’re going to see tight market conditions for some time to come now before we get into the numbers let’s take a look at what’s going on in the news
The big story in real estate this week is that the average house price in Toronto is expected to surpass $1,000,000 by the end of 2021
When you look at the article, I’ll quote, “we reverted back to the scenario that really we’ve been talking about a lot over the past number years where supply of listings coming onto the market is not keeping up with the growth in transactions.”
As I’ve been saying and I’ve made multiple videos on it including my prediction on why house prices will continue to rise in the Toronto area
this all comes down to a number of factors such as population growth in the city, lack of inventory, lack of new builds being built
consumer preference for actual houses as opposed to condos
and basically what this is adding up to is a perfect scenario
where house prices will continue to rise in the future
I mean our banks are heavily invested in it, and our real estate market is quite heavily regulated
which means that somehow, someway, this market continues to pump along
now also keep in mind that the GTA is the most diverse, economically strong engine in the country
that attracts a lot of people into the area so without solving the problem of how many properties we can get online and housing these people
We’re always going to have a housing shortage, and when you have more demand than supply available, then the law of economics will always dictate that prices will always continue to go up
Until that factor changes, we’re not going to see a change
Sure, we can see a bit of market cycling, periods of very high growth followed by maybe slower times, maybe a little bit of a decline
But when you look at real estate over the macro in the long term
The trend will continue to go up until there’s no longer any demand for homes in the GTA
Next let’s talk about the confusion in the market
The Toronto Star posted a recent article talking about how home prices are surging and the market’s doing really well
but then three weeks ago they posted an article talking about how CMHC predicts a 15% drop in home prices
like if you’re the one that reads every news article out there or follows the news
you don’t know what to think
I mean even RBC, their own executives were telling their investors that real estate prices in Canada we’re going to go down
yet their economists are predicting prices are going to go up
I think a lot of people, they tend to look at real estate through their lense
so, if you’re a banker, you’re looking at it in terms of interest rates are the only thing that drive this
or if you’re looking at development, you’re looking at “well if we’re not building enough, that’s what drives prices”
At the end of the day there’s a number of things affecting it from interest rates,
population demographics, future growth to even environmental policies
everything that the government does, every decision that’s made has a ripple effect on real estate
and sometimes it’s hard to see it at the time, an idea that sounds good at the time
could actually have large implications in the future
my guess is that until the supply issue is solved in the GTA
we’re probably still going to see continuing rising prices with periods
where maybe the market slows down. whether is government regulation
or a bit of a hiccup and a reset
but overall I still think we were into it for the long term.
All right let’s get into the numbers
So when we’re looking at real estate, again the 905 was the big winner in terms of sales and price appreciation
when we look at the chart you can definitely see right away that when comparing a detached house in the city of Toronto which went up I’m very good 16%
it’s nothing in comparison to the 36% year-over-year increase that we saw with detached houses in the 905
Again, this is reflecting people selling smaller properties in the city
to move out to the suburbs to get more room
when we look at more modest properties such as semi-detached
You can it more or less in line with each other
With Toronto at 21% and the 905 at 25%
again we look at townhouses, you can see that Toronto’s prices actually did not go up a lot
only 4.1% year-over-year while in the suburbs they were up 20%
now when we get to condos you can see that in the city of Toronto the prices are actually down because the highest concentration of condos is in the downtown core
which was hit the hardest by coronavirus however in the 905
condos have gone up a modest 5%
which doesn’t look good when you compare it to single family residence but still doing quite well compared to the city counterpart
one thing I will say about condos is we are seeing an uptick in sales even in the city of Toronto
and this may be signalling the bottom has come for the Toronto condo Market
eventually if the single family houses get too expensive and we’re hitting affordability issues then people again will start to go towards condos in order to find home ownership
so that is a trend that I would definitely keep an eye on in the future and especially through the spring and summer
Well there you have it, I hope you enjoyed by February 2021
Greater Toronto real estate market update
as you can see consumer confidence is very strong in real estate
especially in the 905 area
when we’re looking at what’s going to be happening over the spring and summer of 2021
things to keep an eye on include this continuing migration out in “The Burbs”
will the prices continue to keep rising higher than in the city of Toronto
and also let’s keep an eye on the Toronto condo Market
which I personally believe has probably hit its bottom
and it’s going to slowly start to make a comeback
either way it’s going to be exciting year and if you have any questions about Real Estate
always feel free to call or email me
I’m Jeff O’Leary “The Village Guru” have yourself a great day!
