The Toronto Real Estate Board launched its ground-breaking Market Year in Review & Outlook report at an event in Toronto.
“After a record year for home sales in 2015, another strong year is forecast for transactions reported through TREB’s MLS® System in 2016. Between 96,500 and 105,000 home sales are expected to be reported this year. Whether we see the second best year on record or a second consecutive record year will largely depend on the direction of borrowing costs and the availability of listings, particularly in the low-rise market segments,” said Jason Mercer, TREB’s Director of Market Analysis.
The report provides key insight on the current state and future of the real estate market with key statistics from a never-before-seen survey of recent and intending home buyers conducted for TREB by Ipsos Reid.
Home prices in Toronto will continue to trend upward in 2016, says TREB
Ipsos Reid Vice President Sean Simpson was on hand to break down the results of the consumer surveys against the backdrop of TREB statistics.
“Ipsos Reid’s recent survey of intending buyers found that 12 per cent of GTA households are very likely to purchase a home over the next year. First-time buyers accounted for approximately half of intending buyers. These results bolster the argument that people in Toronto and the surrounding regions continue to view home ownership as a solid long-term investment. This includes young people aged 18 to 34, who made up the majority of intending first-time buyers,” added Mr. Simpson.
Home prices will continue to trend upward in 2016. The calendar year average selling price is forecast to be between $655,000 and $665,000.
“For most home buyers, at least some of their purchase price will be covered with a mortgage. However, the Ipsos Reid survey found that a very small share of intending buyers were planning on down payments of between five and 9.9 per cent. This suggests that only a small percentage of intending buyers will be impacted by the mortgage lending guideline changes announced by the Federal Government in December 2015,” said Mr. Mercer.
TREB President, Mark McLean highlighted the importance of this report to the 43,000 Toronto Real Estate Board Members who practice real estate in the Greater Toronto Area and surrounding Greater Golden Horseshoe.
“Having never-before-seen statistics on home owners and intending buyers at our fingertips will further assist REALTORS® in better serving the public. You can’t put a price on this kind of knowledge,” said Mr. McLean.
Another key aspect of this report is examining the current liveability and future competitiveness of the Greater Golden Horseshoe Region. TREB reached out to stakeholders in the government, public, not-for-profit and private sectors to understand what it is that makes our region such a great place to live, work and raise a family as well as what it will take to continue to build on our success and enhance our position on the world stage.
Respondents lauded the region for its diversity and the economic and social opportunities it affords residents while highlighting our transportation system, public infrastructure and greater housing options and affordability as key areas for improvement.
TREB CEO, John DiMichele stressed the importance of approaching these challenges collaboratively in order to ensure they’re met with maximum efficiency and at minimum cost.
“Today we have an opportunity to stop working in silos and to engage each other to expand our thinking on today’s most complex problems. This is a work in progress and will continue to be for some time. There are a lot of smart people who responded to our call for stakeholder submissions or who contributed to the sections of this report and it would be great to get them in one room where they could discuss these issues collectively. We need to realize that we all have a stake in the outcome and that it’s time for us work together to ensure today’s opportunity becomes tomorrow’s reality,” said Mr. DiMichele.
Providing context for the report’s new home market section was Bryan Tuckey, President and Chief Executive Officer of the Building Industry and Land Development Association, and RealNet Inc. Founder and President of RealStrategies Inc., George Carras.
“Home builders can only build what governments permit and markets respond to policies,” said Mr. Carras. “Over the last decade intensification policies have required more high-rise and less ground oriented housing and that has affected the supply and price of homes in the market. RealNet’s New Home Price Index for low-rise homes has trended upwards at double digit year over year increases, and while the high-rise price index has remained relatively flat in recent years, rising development costs are being addressed in part through smaller unit sizes in order to maintain affordability,” said Mr. Carras.