Toronto outpaces Vancouver and becomes Canada’s most expensive housing market

The GTA is now considered to be Canada’s most expensive housing market.

Toronto has outpaced Vancouver, which had been country’s priciest place to purchase a property for decades.

The benchmark MLS Home Price Index for Toronto rose by 4.3% (or $52,000) from December to $1.26 million in January, exceeding Greater Vancouver’s result of $1.255 million.

“It’s an incredible change, although not fully surprising considering how hot the Toronto market has been, especially since the fall,” – said RBC economist Robert Hogue. “Competition between buyers is extremely strong. Widespread bidding wars have pushed prices to new records both in level ($1.260 million) and in a gain size (33.3%).”

In Hogue’s opinion, we won’t see any significant change in the nearest future, until future interest rate hikes “gradually cool things down” later this year.

“The housing crisis in Toronto reached a new level last month,” – analyst Ben Rabidoux noted.

“We’ve now exceeded 2017 peak price acceleration results,” – he said. “At that moment, these prices made policy-makers tighten mortgage rules and introduce a foreign buyer tax. But it was almost entirely focused in Toronto then.”

Today, real estate prices across the entire province are going up by 25-50%.

Here are the January numbers from one of the country’s biggest regional real estate boards:

Greater Toronto Area

Sales: 5,636

• -18.2% (annual change)
• -6.5% (monthly change)

MLS Home Price Index: $1,259,900

• +33.3% (annual change)
• +4.3% (monthly change)

The number of new Listings: 4,140

• -15.5% (annual change)
• -20% (monthly change)

Greater Vancouver Area

December Sales: 2,285

• -4.4% (annual change)
• +17.5% (monthly change)

MLS Home Price Index for all housing types: $1,255,200

• +18.5% (annual change)
• +2% (monthly change)

The number of new Listings: 4,170

• -6.9% (annual change)
• +114.4% (monthly change)

“Immigration into Canada and the GTA is expected to reach (or almost reach) record high levels this year. And all of these newcomers will need homes,” – noted TRREB President Kevin Crigger. “In addition to it, job creation in average to above-average income segments is also expected to remain strong, supporting consumer confidence to purchase real estate. Nevertheless, the supply will most likely be restrained, intensifying competition between buyers and double-digit gains in home prices.”