Canadians are confident in the Canadian real estate market, and they’re putting their money where their mouth is. According to the latest numbers from the Canadian Real Estate Association (CREA), all but one significant market experienced price increases in March. The Greater Toronto Area (GTA) is of particular note, with prices spiking even in the surrounding areas.
Toronto Saw The Highest Increase
The city of Toronto saw the highest increase across the country in March, which probably wasn’t much of a surprise. The aggregate benchmark price, that is the price of a typical home being purchased, is now $772,500 – a 6.2% increase from the month prior. To contrast, last year’s market was pretty hot too, but it only increased 2.29% over the same period. March 2017 is almost 3 times the rate of 2016.
Areas Surrounding Toronto
Toronto’s enthusiastic buyers appear to be spreading to the surrounding areas, which is a little strange. Hamilton, about an hour drive from Toronto, saw prices increase 5.9%. Guelph, another metro area located within an hour, saw prices climb 3.6% from the month prior. And Oakville, about 20 minutes from Toronto, saw prices rise 3.6%. So it seems that buyers are equally enthusiastic about the surrounding markets as Canada’s largest city.
Source: CREA.
Everywhere But Central Canada Is Moving Fast
Actually, almost every metro area in Canada is doing very well according to CREA, the exception being central Canada. Regina saw a 0.2% increase from the month prior, and Calgary saw a 0.3% increase. Saskatoon saw a mild decline of 0.1%, which left it mostly flat. Now these numbers are far from bad, they just don’t look like much in contrast to rising prices across the country. Traditionally hot markets such as San Francisco, saw a decline of 5.7% during the same period.
The confidence from buyers comes at an interesting time, especially around the GTA. The Ontario government has increasingly expressed concerns that real estate prices in the province are moving unsustainably. The increase in speculative purchases, and an increase in subprime borrowing is reaching a boiling point. It’ll be interesting to see if cash flow can continue to support the optimistic buyers.
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Vancouver you can argue is expensive because they’re locked by water on three sides. Toronto you can argue is expensive because its Canada’s most densely populated city. Guelph? Surrounded by farm land. Kitchener? Surrounded by farmland. These cities have the same deal as Calgary, where it’s flat and there’s tons of room to expand. No one’s paying massive premiums in Calgary because they understand that.
You don’t get it, Guelph is the Paris of Canada. Every Canadian has dreamt of growing up there, or Hamilton. Waking up to the smell of steel in the morning is just satisfying. This was sarcasm btw.
Half of Ontario is rock, you can’t just build on all the farms.
No one liked Brooklyn in the 80s, either, and Portland was a backwater. That was only 30 years ago. Also, Guelph’s water supply is limited. It can’t spread out indefinitely on the groundwater available.
Guelph and Kitchener are world class cities!!! They’ve been undervalued for decades are only now approaching their true value!!! Before long, we will see these urban gems with real estate priced in the same range as New York City, London and Hong Kong!!!!!
/sarcasm, in case it wasn’t obvious…
It’s counter-intuitive, but Regina isn’t “central” Canada. Ontario and Quebec are.
https://en.wikipedia.org/wiki/Central_Canada
It’s slowing down in the GTA and more people are listing wait until the May #’s get published in the first week of June. The Realtors are already starting to feel it. What goes up fast, must come….
Canada Govt with handsome PM Justin has no brain. They do not understand second and third hand Asian buying on food to real estate housing. Data of the foreign buyers is all wrong. It is second or third hand commission base local buying going in Toronto control by brokers living in China.