The Canadian cities of Vancouver and Toronto are no strangers to market success. Over the past couple of years, the housing markets in both metropolises have picked up immense heat, and there have been periods where they have been practically aflame. Competition amongst buyers has been fierce, and the government has had to adjust mortgage restrictions as a result. Furthermore, Vancouver has had to roll out a 15 percent foreign buyers tax to assist its own residents in gaining entrance into the market. In short: The government is doing all within its power to cool down these popular housing destinations.
Regardless, home values in both cities have skyrocketed. Just this past May, the Real Estate Board of Greater Vancouver released that the average price of a detached home in the city had raised 30.1 percent to $1.4-million. Furthermore, the Toronto Real Estate Board says that the average price for a detached home in the city is just over 1.2-million, with the average value of all homes being a stunning $782,051.
Due to the immense market success in the respective cities and whip smart developers that are honing in on lucrative business opportunities, construction rates have also been rising. If you’re looking to purchase a home, here’s what you should know:
Housing Starts are Increasing
According to the Canada Mortgage & Housing Corporation, in June, developers in the country were breaking ground at an annualized pace of 218,333 units, which is a 17 percent increase from the previous month. Also in June, the two hot-market cities starts reached:
- Toronto: Annualized 45,848 – the highest since March.
- Vancouver: Annualized 35,445 – the second highest rate in 16 years.
Developers are intelligent, and have certainly taken note of the profits that are to be made in some of Canada’s most popular cities. In fact, Toronto and Vancouver were responsible for 37 percent of housing starts this past June. Furthermore, a survey conducted by Bloomberg found that economists predicted a reading of 189,500 units, the median of 16 responses.
TREB cited that Toronto’s lack of housing was extremely influential on the overall welfare of Toronto’s real estate market. However, the increase in building sites in the city forecast sunnier days ahead for those looking to get their piece of Toronto’s housing pie.
For homebuyers hoping to slide through the front door and into the Vancouver or Toronto housing markets, the increasing number of housing starts in the cities will make the entrance more attainable despite the competitiveness of the markets.
Furthermore, those who believe that the Toronto or Vancouver markets are anything but sustainable are ill informed. Federal, provincial and municipal governments have made it quite clear through legislative changes and recently proposed and enforced taxes that they are taking the heat radiating off these markets very seriously.
However, even with increased construction and new legislation, the success in those two markets have made it difficult for the average person to afford a detached home. Fortunately, there is an optional route for those who are striving to gain equity and have a place they can call their own, and that is condo ownership.
Condo living is convenient, affordable, and fun. If you are looking to purchase a condo in the GTA but are looking for leads on where to begin your hunt, check out ohm.com for spectacular condo communities that you’ll be inspired to one day call home.