Toronto Real Estate Board REALTORS reported 8,940 sales in March 2015, an 11% increase over March 2014. Sales were up for most major home types, both in the City of Toronto and the surrounding regions. The number of homes available for sale increased to 15,295, but remained 5.5% less than March 2014, indicating tighter market conditions. While the average year to date home price on the Toronto real estate board increased to $594,827, (Up 5% from the start of the year), lower interest rates went a long way to mitigate the effect of rising home prices.
The MLS® HPI Composite Index, which tracks benchmark homes with the same attributes from one period to the next, was up by 7.9 %. Average price growth was strongest for detached homes in the City of Toronto, at 15.9 per cent. Over the same period the detached MLS® HPI in the ‘416’ area code increased 7.8 %.
It seems unlikely that there will be a slowdown in the market. As if strong demand, low interest rates and out of country investors were not enough, we now have a new factor for continued price growth in Canada, the lower Canadian dollar! A lower Canadian dollar will not only motivate Canadians to vacation in Canada, but will also attract vacationers from the US and other countries. This will result in a stronger economy and more jobs which allows and motivates more Canadians to buy real estate. Most foreign investors deal in US dollars and now Canada is on sale for 20% less! More investors, more competition, increased prices.
It is still a great time to buy real estate! While price is an important factor, so is affordability, which is a measure of interest rates, and low interest rates are projected to stay at these levels for the foreseeable future. While I believe it’s a good time to buy and that prices will increase, not all properties will increase at the same speed, and some properties may not increase or even drop in value before inflation and demand do their job. The difference? That’s where my expertise and knowledge of the market comes in, (as well as my negotiating skills). Knowing the good locations and values vs the not so good!
If you know of anyone considering buying or selling, or if you are considering an investment property, give me a call. I would be happy to share my knowledge and expertise with you.
Have a Great April!