Toronto Real Estate Board
2016 market year in review
• Record home sales and accelerated annual sales growth in 2016;
• The key drivers of record home sales include population growth, low mortgage rates, low unemployment, and above-inflation income growth;
• Strong demand and very low inventory resulted in robust price growth;
• Record home sales in 2016 were largely based on domestic demand;
• Foreign buying activity in the GTA represented a minimal 4.9% of transactions. The majority of foreign buyers purchased a property either as a primary residence, to rent out, or for the residency of a family member.
2017 market outlook
• The Ipsos Home Buyers Survey suggests a decline in the number of possible home buyers from 2016;
• Sales on TREB’s MLS System are expected to range between 104,500 and 115,500, with a point forecast of 110,000;
• Despite the possibility of a decline in sales, first-time buyers will continue to account for greater than half of the home sales in the GTA. Strong first-time buyer activity points to confidence in home ownership as a quality long-term investment;
• 2017 will continue to have a shortage of listings, especially in the case of low-rise home types, which remain popular with intending buyers;
• A probably range for the average selling price in 2017 is between $800,000 and $850,000, with a point
forecast of $825,000. This suggests an approximate calendar year growth rate ranging between 10% and 16%.
Transit and affordability
• The Canadian Centre for Economic Analysis’s (CANCEA) study on transportation infrastructure’s effects on housing affordability focused on the introduction of the Metrolinx Regional Express Rail (RER) in the Greater Golden Horseshoe (GGH), and concluded that whether people changed their mode of commuting between locations was the key determinant in whether the RER would impact affordability.
Housing supply and affordability
• TREB believes that the supply issue in the GTA will not be solved without innovative solutions from the
public, private, and non-profit sectors.
Commercial report
• The amount of space leased in 2016 was up for the first three quarters of the year, compared to 2015;
• The Bank of Canada Business Outlook Survey predicts improved business confidence in the future, which foreshadows demand for commercial real estate;
• Continual tightness in market conditions brought about increases in average lease rates for all major market
segments;
• Total commercial property sales in the MLS system correlated with the number of deals reported in 2015;
• Average sale prices, on a per square foot basis, were up for all three major market segments.