Real estate in Toronto and the Greater Toronto Area continues to post solid quarterly and year-over-year gains. While many have been predicting real estate in the GTA will experience a correction or soft landing, that hasn’t happened. In fact, housing prices in the GTA continue to notch higher month after month. Thanks to low interest rates, strong demand, and solid economic growth, many see buying a home in the GTA as an excellent long-term investment.
Toronto Real Estate Remains Hot After 20 Years
Housing in the GTA continues to confound critics who have been calling for a real estate price correction for years now—especially after the U.S. housing market crashed in 2008. But that hasn’t happened.
In fact, since 2008, the real estate market in Toronto and the GTA has experienced solid, sustainable growth. It’s not as if the demand for real estate in the biggest city in Canada is a new phenomenon. The housing boom in Toronto has been going for two decades.
And that shouldn’t be a big surprise. With a population of 2.6 million, Toronto is the biggest city in the country, and the third largest in North America. The GTA has a population of more than six million. The economy is solid and the city regularly ranks amongst the most livable cities in the world.
According to one index, which looks at cost of living, food security, business environment, infrastructure, and other factors, Toronto is the top North American city to live in.1
2015 Was a Record Year for Toronto Real Estate
Because of these reasons, Toronto remains one of the best real estate markets, rewarding homeowners with strong annual price gains. In 2015, the number of homes sold in the GTA increased 9.25% year-over-year to 101,299, the first time the annual figure topped 100,000. In 2014, 92,782 homes exchanged hands.2
The average price of all home types sold in the GTA in 2015 increased 9.8% year-over-year to $622,217. The biggest increases came from detached homes. In Toronto, the price of a detached home climbed 12.6% to $1.04 million. For a detached home in the surrounding “905” area, the price increased 12.1% to $728,015.
That said, all types of properties realized solid gains in 2015. The price of a semi-detached property in Toronto rose 10.1% to $736,082. The same property in the 905 area was up 11% at $492,643.
The price of a townhouse in Toronto jumped 10 to $542,406, while in the 905 area the price increased 10.3% to $449,218. Even condominiums were a great investment, with the price appreciating five percent to $405,589 in Toronto and by the same amount in the 905 area to $317,572.
Momentum Carries into 2016 with Record Numbers in May
The momentum over the last number of years carried into 2016 with strong growth in the first five months of the year. In May, both sales and prices reached record levels in Toronto and the GTA.3
The number of home sales in May 2016 reached a record 12,870, a 10.6% increase over the 11,640 sold in May 2015. The average price of all housing types in the GTA climbed 15.7% in May to $751,908, with detached homes experiencing the strongest price appreciation. In Toronto, the average price of a property was up 8.9% at $782,051. In the 905 area, the average price increased more than $100,000 (20.1%) to $734,924.
In May, the average sale price for a detached home in the city of Toronto rose 15.2% to a record $1.28 million. In the rest of the GTA, the price of a detached home climbed 21.2% to $891,870.
The price of a semi-detached property in the city of Toronto was up 7.1% at $834,883, while in the 905 area the price of a semi-detached home increased 19% to $586,849. Townhouses continue to be an excellent investment, rising 12.9% in Toronto to $626,305 and 17.2% in the rest of the GTA to $527,503. The same goes for condominiums: prices climbed five percent in Toronto to $442,520 and 8.7% in the 905 area to $347,431.
Canadalend.com, Helping Those in the GTA Find the Best Financial Products
You need three elements to keep a housing market strong: supply, demand, and affordability. There is a lot of demand in the GTA for real estate and the supply is limited.
As for affordability, home ownership in the city of Toronto and the GTA is an excellent long-term investment. Thanks to a relatively strong regional economy in the GTA and low borrowing costs, first-time homebuyers can feel confident about both their purchase and ability to pay for their home over the life of the mortgage.
If you’re looking at purchasing your first home in Toronto or the GTA or moving up, the independent, licensed agents at Canadalend.com can help you navigate the often confusing world of mortgages.purchasing your first home in Toronto or the GTA or moving up, the independent, licensed agents at Canadalend.com can help you navigate the often confusing world of mortgages.
At Canadalend.com , we understand that there is more to getting a mortgage than just the lowest interest rate. In addition to finding a competitive interest rate, you’ll also need to consider the mortgage term (the length of time you commit to the current mortgage rate; the most common term in Canada is five years) and amortization period (how long will it take you to pay off your mortgage is full).
Your Canadalend.com agent will help you determine which type of mortgage is best for you. The experts at Canadalend.com will also help you find the mortgage term and amortization period best suited to your financial and lifestyle needs.
To get you the best financial products, our agents draw from hundreds of banks and lenders to help you secure the mortgage product best suited to you. Canada’s big banks only offer you their own in-house financial products, whether they suit your needs or not.
To find out what kind of mortgage products are best for you, contact Canadalend.com today. Or apply o nline and a Canadalend.com lending specialist will help you set up an appointment for a free personal consultation at your earliest convenience.
1. “Toronto And Montreal Are The Best Cities To Live In, According To The Economist,” huffingtonpost.com, January 28, 2016; http://www.huffingtonpost.ca/2015/01/28/toronto-montreal-best-cities_n_6563024.html.
2. “GTA Realtors Report Record Year for TREB MLS Home Sales,” trebhome.com, January 6, 2016; http://www.trebhome.com/market_news/release_market_updates/news2015/nr_market_watch_1215.htm.
3. “GTA Realtors Release Monthly Resale Housing Market Figures, trebhome.com, June 3, 2016; http://www.trebhome.com/market_news/release_market_updates/news2016/nr_market_watch_0516.htm.