Average Toronto home prices expected to surge upward in 2021
According to RE/MAX Canada, which published its highly-anticipated 2021 Canadian Housing Market Outlook earlier this week, prices are expected to continue rising in the city across all markets — not just detached homes, which have been skyrocketing in value since the COVID pandemic hit last spring.
"The Toronto housing market is expected to be in seller's favour in 2021, characterized by a persistent supply shortage and rising prices," reads a report released by the real estate giant on Tuesday about Toronto, specifically.
"Low inventory has been a common trend across many Ontario housing markets in 2020, putting upward pressure on prices... Growing demand, low supply and rising prices are expected to impact activity and prices in 2021."
Between January 1 and October 31 of 2020 alone, the average price of a home in Toronto rose to a whopping $918,883 from just $819,832 in 2019.
Please keep in mind that we're not only talking about houses here, but condos, too: The above stated figures pertain to the average among all types of properties sold within the GTA, including detached homes, townhouses, semi-detached homes and shoebox units in the downtown core.
"Housing supply levels continue to decline, and are not expected to improve in 2021, which may push average home prices up," notes RE/MAX, which is predicting a six per cent increase in average home prices across all property types in the City of Toronto for 2021.
If analysts are correct, the average Toronto home will sell for about $974,015 in 2021.
"The Toronto housing market has experienced shifts in buyer demand prompted by economic factors, lifestyle changes and immigration in the wake of COVID-19," reads the RE/MAX report. "Toronto's condo market is currently a buyer's market, whereas the rest of the market favours sellers."
While this is true, less and less people appear to be opting for tiny condos in light of requirements for many downtown office employees to work from home amid the pandemic.
"Given that remote work is a widely available option, many Toronto buyers have been choosing homes based on affordability, often outside of the city, versus being close to their place of work within the core," notes RE/MAX.
"This migration outside of urban areas has been a common trend across many Canadian housing markets as well as regions abroad, as homebuyers seek more square footage and green space, and less density."
Despite this, RE/MAX expects to see a lot of activity on the condo market in 2021 based on how affordable they're becoming. First-time home buyers and immigrants coming to the city for education are expected to be the drivers of this trend.
"Outside of the downtown core, the condominium market has been relatively balanced since the start of COVID-19, based on buyers looking for more space while still being mindful of budget," reads the report.
"Toronto's luxury housing market remains largely unimpacted by COVID-19 and is driven by move-up buyers."
As of 2020, the average price for a luxury home in Toronto was $3.3 million, suggesting that the aforementioned "move-up buyers" are in the minority of Toronto residents (read: really rich people.)
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