Average home price expected to rise by 3.7% next year
• Increased consumer confidence could be a key factor affecting the housing market in 2020
• 51% of Canadians are considering a home purchase in the next five years, up from 36% at the same time last year
• Only two in 10 Canadians say that the mortgage stress test negatively affected their ability to purchase a home in 2019
Toronto is set to experience a strong housing market in 2020. Lower unemployment rates, economic growth and improved overall affordability in the Greater Toronto Area are expected to drive the market forward. The estimated average sale price increase for 2020 is six per cent, two points higher than the growth experienced between 2018 ($736,256) and 2019 ($766,236). The city saw 76,413 properties sold in 2019, up 12 per cent from 2018 (68,064). While Toronto is experiencing its “busiest” construction season ever, housing supply still falls short of the demands of the city’s rapidly growing population.
Cities such as Ottawa and Windsor are seller’s markets, showing substantial increases in average residential sale price at 11.7 and 11 per cent, respectively. This strong growth is expected to continue into 2020, with Ottawa’s new LRT system impacting surrounding development and Windsor’s continued affordability attracting young professionals to the area. Buyers are also not burdened by the mortgage stress test, as they were in 2018.
The Niagara region is also showing strong growth, with average residential sale price increasing almost 13 per cent, from $378,517 in 2018 to $427,487.50 in 2019. Value-conscious consumers from the Greater Toronto Area are buying in droves, with many choosing to live in the region while commuting to Toronto.
“Southern Ontario is witnessing some incredibly strong price appreciation, with many regions still seeing double-digit gains,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Thanks to the region’s resilient economy, staggering population growth and relentless development, the 2020 market looks very optimistic.”