The Toronto real estate market and its surrounding region is large enough to have many sub-sectors. Although the headline always speak of it as one market, Strategic Investors understand that frankly isn’t true. So how about some facts! The good research team at TheRedPin have peeled the onion on the Toronto real estate market. I think you’ll find their discoveries very helpful. Here is their post:
GTA’s Hottest Real Estate Markets
When Don R. Campbell stepped into TheRedPin’s doors back in 2013, among the very first points he raised was that if you focus solely on average sale price and days on market, you’re 18 to 24 months behind a strategic investor.
It’s a profound point, especially for those looking at the housing market strictly from an investor’s eye, as data on Gross Domestic Product, local population and job growth are key insights that cannot be ignored when analyzing the long-term prospects of a particular market.
That being said, using more conventional real estate data-points can help provide a look into which markets are currently outperforming and where homeowners (strategic investor or run-of-mill property owner) saw the largest gains in the past few months and years.
With exactly that in mind, we decided to delve deep into the housing numbers for Canada’s largest city, Toronto, which experienced a record-year in its real estate sector in 2015.
Home sales across the City of Toronto and the numerous suburban cities and towns that make up the GTA cracked 100,000 last year, a never-before hit milestone. Prices also jumped leaps-and-bounds, collectively up 9.8 per cent in the 2015 calendar year.
Rather than pit all 31 of the GTA’s various cities on an equal playing field, we highlighted the housing markets which out-performed across three separate categories: largest gains in home values, greatest spike in year-over-year sales and where homes spent the fewest days on the market before being snatched up by a buyer. To add to that, cities with the least and most expensive real estate in Canada’s largest metropolis were also included.
The GTA’s Hottest Real Estate Markets – By Category
For locations see map at the bottom of this page. But here is the overview:
In terms of which individual cities made the most waves on the sales growth front, Burlington managed to beat out all the other 30 cities listed on the Toronto Real Estate Board. The Halton Region city saw the number of home sales climb a considerable 23 per cent in 2015 over the previous year.
Aurora managed to trail in second place with a substantial 14.7 percent increase, while Georgina – the northern-most city of the York Region, came in a close third with sales up 14 per cent.
Homeowners in the York Region had plenty of reasons to rejoice in 2015. Despite talk of million dollar detached homes in Toronto, it’s the York Region that actually managed to come ahead in terms of the all-important factor of year-over-year price growth.
The average single-family detached home in the York Region experienced a 14 per cent spike in its home values. Toronto saw a very notable but lesser 12 per cent jump.
When pin-pointing exactly which municipalities saw the most profound leaps in home values, it comes with little surprise that they also fall in the York Region. Witchurch Stouffville, which currently has average home prices hover around $789,730, saw values up 20 per cent.
Newmarket and Richmond Hill, both cities located within the bound of the York Region and dominated by highly sought-after freehold properties, came close with a 16.4 per cent increases in prices. Just to put that in the perspective of raw-numbers, the average 2014 price of a Newmarket home was $531,376. Just one calendar year later and properties in the same city changed hands for $618,498.
Fastest Selling Homes
How long, or little, a property spends on the market isn’t always indicative of strength. Pricier homes tend to spend longer on the market, regardless of how much their home values may have jumped for example.
However, if homes are getting snatched off in record-time, there is a strong indication that market confidence is strong and property is highly desirable.
Ajax came out on top on this category, with the average residence spending just 13 days on market – which is 40 per cent faster than the GTA-wide average.
The strength of the Durham town’s housing market doesn’t only come down to DOM, as prices also saw a substantial 14 percent leap in 2015 versus 2014.
Whitby, also in Durham, and Newmarket saw homes change in a swift 15 and 17 days respectively.
Least and Most Expensive Homes
As home value climb across the region, the boundaries of affordability continue to branch further out west and north.
Oshawa, 60 kilometers out from downtown Toronto, is home to the most affordable residential properties of entire the region, with the average sold price in 2015 at $349,101.
Clarington came in second on the affordability scale ($392,101) – rounding off the list of GTA cities where average prices sit below the $400,000 mark – while Georgina came in third at $410,915.
In terms of the priciest homes, look no further than King City, a township dominated by luxury homes and million dollar custom builds where residences sold for an average of $1,006,701. The staple suburban cities of Richmond Hill and Oakville followed far behind with prices hovering around the high to mid $800’s.
Strategic investors who look beyond the noise and are laser-focussed on identifying housing markets that promise maximum gains down the line, in the next 10 years and beyond, have average price and DOM as just one part of their repertoire of statistics and data. But while they do not serve as the end-all and be-all of the real estate market, as is sometimes depicted in news headlines, they do provide unique insights into which cities are currently outperforming and a general overview of the region’s market dynamics. After all, the more data, the better.
[Map] The GTA’s Top Performing Housing Markets