Toronto Real Estate Stabilizes as Vancouver Struggles
The two biggest housing markets in Canada, Toronto, and Vancouver, both had tough years last year. With the introduction of the foreign buyer tax, stricter mortgage rules, and skyrocketing prices, the markets suffered.
According to March’s TREB numbers, Toronto’s real estate is finally beginning to hold steady. Vancouver isn’t as lucky though. The number of home transactions dropped 31% in Vancouver in March. This was the lowest numbers of sales in the Greater Vancouver Area since 1986.
The president of the Real Estate Board of Greater Vancouver (REBGV), links the floundering market to regulatory changes imposed in recent years, namely new transfer taxes and stricter lending regulations. These make it challenging for new buyers to secure a home.
The president of the Toronto Real Estate Board (TREB) agrees. He blames the mortgage stress test and other policy changes, which affect a buyers’ capacity to qualify for a mortgage. The stress test, in particular, has been blamed for severely slowing down the market, and there have been calls to adjust it.
The result is that Vancouver home prices are dropping, even though there are 52% more homes listed. The average price of a home in Vancouver dropped 7.7% year-over-year, with condos and semi-detached homes down as well.
So why are buyers still not purchasing even with more options and lower prices? Real estate agents suspect buyers are waiting and observing in hopes that prices continue to fall.
Homes in Toronto meanwhile have begun to stabilize. Home sale prices were up 2.6% year-over-year in March. Condos in the city are also a huge driving force for the market.
Overall, Canada’s real estate market is bouncing back; even though it’s two biggest markets are the slowest to do so. Toronto may soon outpace Vancouver and snagged the spot as top real estate market in the nation. If you need help buying or selling your Richmond Hill home in the GTA, feel free to contact one of our real estate agents today!