The market has seen accelerated activity during the first six months of the year
A steady decline in the supply of single-detached homes in the Greater Toronto Area, along with mortgage rates remaining lower than 3%, has impelled demand from first-time home buyers – in turn firing up the region’s housing market during the first half of 2021, according to RE/MAX.
“Inventory constraints propelled demand throughout the GTA and set the state for unprecedented market performance, with values of single-detached homes soaring almost 97% of TRREB communities well ahead of year-ago levels, with nearly half reporting an increase of 25% or more compared to the same period in 2020,” RE/MAX said in its just-released 2021 GTA Hot Pocket Communities Report.
At 11,297 active listings, the GTA posted its lowest June inventory level in at least a decade, hovering at 35% lower than the 10-year June average of 17,260 listings.
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Sales activity during the first six months of the year saw a correspondingly strong increase, with transactions swelling in York Region (up by 109.6% annually), Peel (up by 98.2%), and Central Toronto (up by 96.7%).
“Overall home sales topped 70,000 between January and June, the strongest first half in the history of the Toronto Regional Real Estate Board, while values smashed through record levels set in previous years,” said Christopher Alexander, senior vice president of RE/MAX Canada. “Without a serious influx of new listings to ease the upward pressure on pricing in the coming months, the market will likely continue on this upward trajectory.”
Alexander said that these indicators might be just the beginning of a period of unenviable volatility in the GTA market.
“With the worst of the pandemic hopefully in the rear-view mirror and recovery on its way, economic expansion is likely,” Alexander said. “The Bank of Canada is committed to holding interest rates at current historically low levels for at least another year. Immigration is expected to bring another 1.2 million permanent residents to the country over the next three years. With all this stimulus at play, comparisons have been made to the Roaring 1920s – let’s just hope that this script has a better ending.”
