The long anticipated occasion buyers and investors have been looking for has arrived. Latest statistics from the Toronto housing market specifies that the market is returning to normal. Even though this is good news for everyone, it is however left to the province to measure how long this will last.
Real estate agents contend that in spite of the market showing signs of cooling, the features accountable for driving the markets up are still predominant as the Greater Toronto Area market continues to remain attractive to foreign investors. Market spectators are also still at work making buyers still doubtful about the market.
In a report released on June 5th by the Toronto Real Estate Board, it was emphasized that home sales for May 2017 in the GTA dropped by 20% from the previous year, with new homes listed in the market increasing by 43%. Although the average home price for May was up by 15% to $863,901, it was however a 6% decline from April. With more homes listed in the market, the impetus for home demand was reduced with less pressure on supply.
Last year, home prices began to steadily rise in the early months and before this, home prices were quite stable with all pertinent elements that affect market prices in place. Nonetheless, things began to go bad when home prices rose more than 30% which was way over market ground rules. This occasioned policy makers attributing several factors to be responsible for the increase. Bulk of the liability was cast on foreign buyers in the region, which led the provincial government of Ontario to introduce a 15% tax on foreign investors. Vancouver in turn adopted the tax in August and following the implementation of the tax, home prices begun to show a slow decline.
Although there are signs that the market is stabilizing with home sellers going out to sell their properties prior to further market decline, buyers are however not getting carried away by the situation.
According to Benjamin Tal CIBC deputy chief economist, buyers are thinking hard before buying.
Real Estate Investment Company Ontario’s director of acquisitions and financing, Chris Nelson cited that regardless of the new developments, foreign buyers are still interested in the GTA. He noted that Canada has a very attractive market and by the end of 2016, the market was in the global limelight as a result of several causative features including Donald Trump’s victory, the Brexit and also the political vagueness across Europe.
Toronto real estate market came into the picture following the 15% tax levied on foreign investors which led to many buyers in Vancouver to move to Toronto.
Although the average home price in Toronto which is at $863,910 and very equitable for the average Canadian, it is however very reasonable for foreign buyers equated to other real estate markets in cities like New York, San Francisco and London.
J C Loum