Toronto’s rental market is scorching hot, real estate market correction eases and Toronto ranked among the top 5 safest cities in the world. Here are the five updates from Toronto real estate market you absolutely shouldn’t miss:
First and foremost, the market numbers for September were released and we could not leave it without a comment. The sales were down by 35 per cent compared to September 2016 and amounted to 6,379 properties sold.
The inventory increased by 9.4 per cent year-over-year. The average price in September 2017 reached $775,546, which represents a moderate price growth year-over-year of 2.6 per cent. The only exception is the condominium segment, where the prices soared by more than 20 per cent.
Richard Silver of Torontoism noted that Toronto had transitioned from a mostly residential housing market to a mostly condominium market. He also foresees the next major changes going forward would be a New York Style of life where city-renting and country-ownership would become more of a norm.
Toronto Star: Toronto housing price ‘correction’ eases: Report
Another take on September TREB numbers from Toronto Star. According to a new report by Royal LePage, Toronto real estate market shows signs of recovering. Prices rose 1.5 per cent in recent months, and the increase is expected to continue through the end of the year. Some corners of the GTA are also seeing bidding wars again, says the report.
Royal LePage CEO Phil Soper compared the dynamics of Toronto real estate market after the introduction of Fair Housing policies to Vancouver, except that Vancouver took about ten months to recover, whereas six months were enough for Toronto. Toronto’s bigger market and more diverse economy support a milder correction, he said.
Soper also described the current situation in the housing market as “a Goldilocks moment”: not too hot, not too cold, but just right.
One of the important factors affecting the state of Toronto’s real estate market is the city’s appeal in terms of safety and quality of life. According to a new ranking, compiled by The Economist, Toronto is the safest city in North America and ranks in the top five among 60 other major cities globally. The report is based on comparative data for urban security, including digital security, health security, infrastructure security and personal security.
Tokyo, Singapore and Osaka take the top three spots respectively, as seven of the top 10 are cities in Asia. Toronto is the only Canadian city that made it in the list. Only three American cities managed to be in the top 20, San Francisco being the leader among them. It is indicated, that the bad state of country’s infrastructure is to blame for the low rankings of most U.S. cities.
Urbanation: Rents Continue to Soar Against Inadequate Supply
According to the report from Urbanation Inc., during the third quarter of 2017, average rents for condominium apartments in the GTA increased by 10.3 per cent year-over-year as monthly rents reached an average of $2,219 (for average size of 743 sq.f.).
Rental activity for smaller and less expensive units declined on lower levels of supply. The volume of one bedroom without den rentals dropped by 11 per cent while studio rentals fell by 3 per cent. The scarcity of available one bedroom rentals led to a sharp increase in rental prices. Condos listed for rent spent on average only 10 days on the market.
The factors affecting the tightening of the rental market are the incoming migration, the decline in home sales, two interest rate increases and the aftermath of the Ontario government’s Fair Housing Plan.
Ryerson report was released the same day as Urbanation data, and, in line with Urbanation’s conclusions, it says Toronto needs more rental units – 8,000 new rental units a year, to be precise. In existing market conditions, only this number would permit tenants to find suitable, affordable housing.
Rents for available one-bedroom apartments increased 6.3 per cent between 2015 and 2016 and 8.8 per cent in the last year, says the report. Last month the situation got even worse, when Ontario introduced extended rent controls to newer buildings when developers decided to convert 1000 planned rentals to condos.
The city is already looking at other policies recommended in the report, including a vacancy tax and restrictions on short-term rentals, although the effectiveness of vacancy tax is widely questioned.