By The Canadian Press
Action is needed now on housing supply and transit, according to the Toronto Regional Real Estate Board, as its outlook sees increased home sales while new listings are expected to be static or drop.
Housing sales are expected to climb 10 per cent this year to about 97,000 home sales, the board said in a forecast out Thursday, up from the 87,825 sales last year.
“Robust regional economic conditions, strong population growth and low borrowing costs will support increased home sales in 2020,” said board president Michael Collins in a statement.
“Market conditions will become tighter, as transactions will continue to outpace the growth in available listings.”
The higher conditions mean the average sale price could climb about 10 per cent this year to $900,000, up from $819,319 last year.
January saw even larger increases in sales and price gains. There were 4,581 home sales in the month, up 15.4 per cent from the same month last year. The average sale price of $839,363 was up 12.3 per cent compared with a year earlier.
The climb in January followed a trend in the latter half of last year that saw home sales begin to rebound as mortgage rates trended lower and people adjusted buying plans to the mortgage stress test put in place at the start of 2018 and other policy changes.
‘After more than three years of slower market activity brought on largely by changes in housing-related policies at the provincial and federal levels, home sales will move closer to the demographic potential in 2020,” said Jason Mercer, TRREB chief market analyst in a statement.
The board says both price and sales growth are likely to be concentrated in the semi-detached, townhouse and condo markets that are somewhat more affordable, but that the average price could rise further if detached home prices see a similar pace to other home types.
It says that according to an online survey by Ipsos, more than half of buyers claim to have been affected by the mortgage stress test, pushing them to change expectations on home price, type or location, as well as to look to alternate lenders.
The survey found that while detached homes remain the most popular intended type of home to purchase at 42 per cent, it has dropped from 54 per cent when the survey was first conducted in 2015.
According to the polling industry’s generally accepted standards, online surveys cannot be assigned a margin of error because they do not randomly sample the population.