TORONTO, ONTARIO, January 2018 – The Toronto Real Estate Board recorded 92,394 sales through TREB’s MLS® System in 2017 which is is down 18.3 per cent in units compared to the record set in 2016. Record sales in Q1 were followed by a decline in Q2 and Q3. The average selling price for 2017 was $822,681 – up 12.7% over 2016. The annual growth was driven by extremely tight market conditions during the first four months of the year. Of note, home price growth in the second half of 2017 differed dramatically depending on home type. The detached segment experienced the lowest increase while the condominium apartment segment experienced double-digit growth.
Much of the sales volatility in 2017 was brought about by government policy decisions. The Ontario Fair Housing Plan, which included a foreign buyer tax, had a definite psychological impact on the market. Some areas in GTA such as Oakville have seen prices fall on a year over year as they they had a higher level of foreign investment in the spring which has largely concentrated at the high end of the market. We experienced the same run up as well in the prime south Mississauga areas. Wealthy foreign buyers continue to price local affluent buyers out of high end neighbourhoods.
In the first few months of 2018, government policy could continue to influence consumer behavior as changes to federal mortgage lending guidelines came into effect on Jan 1st. New mortgage rules have been expanded to apply to uninsured mortgages as well, (those with a downpayment in excess of 20%) “What it means for buyers is more money down, a less expensive property- or seek a mortgage from a mortgage lender not governed by the federal banking regulator” says Kevin Larose of The Larose team. “Some but not all pre-approvals were subject to 2017 rules- check with your lender before you purchase.”
A growing supply of inventory has kept price increases in check. The central bank raised its key lending rate by .25% this month to 1.25%. And Canada’s 6 largest banks have announced they will raise the prime lending rates to 3.45% “What will have more of an affect on the market than anything else is rising interest rates” says Kevin Larose. We can expect a steady spring market and those that go to market early could end up the big
winners this year.”
The economy is healthy and there is much building and growth planned here in the south Mississauga areas. If you are looking to make a move in 2018, contact us at (905) 278-7355.