Toronto real estate resilient in first half of 2009
One in five neighbourhoods have surpassed pre-recession average price levels
Canada News Wire
In the midst of the recession, approximately 20% of single-detached homes and condominiums in Toronto neighbourhoods managed to post an increase in average price, according to RE/MAX.
Comment: Remember, though, the Bank of Canada has announced that the recession is over. And with stocks up, retails sales up, consumer confidence up and real estate sales up – I think we can see it for ourselves.
The RE/MAX Return on Investment Report found that 11 (17%) of the 65 Toronto Real Estate Board (TREB) districts reported an upswing in the value of a single-detached home in the first six months of 2009, despite one of the worst first quarters on record.
The Beach (E02) saw the greatest percentage increase year-over-year at 3.79%, with average price rising to $715,422, up from $689,278 in June, 2008. Pickering (E13) placed second, with the average price of a single-detached home climbing 3.72% to $389,536, up from $375,577 from one year earlier. Willowdale, Newtonbrook (C14) ranked third, with a single-detached home rising in value from $754,470 to $779,537 – a 3.32% increase. Rounding out the top five neighbourhoods are newcomers Downsview, Weston (W04) – where prices have climbed 2.25% to $384,485 from $376,007, and Rouge, Malvern (E11) where a 1.99% uptick has brought year-to-date housing values to $345,468 (from $338,738).
“Purchasers clearly moved to take advantage of greater affordability in the marketplace in the first half of the year,” says Michael Polzler, Executive Vice President, RE/MAX Ontario-Atlantic Canada. “Prices were down in virtually every neighbourhood surveyed; supply of homes listed for sale was at an all-time high; and interest rates were at historic levels. If you’re a buyer, it doesn’t get much better than that.”
Given their more affordable price point, condominium properties fared slightly better than single-detached homes, with 13 (22%) of 59 TREB districts posting an increase in average price. Condos in Cliffcrest, Guildwood (E08) in the city’s east end saw the greatest appreciation in value, with average price climbing 6.45% to $175,855, up from $165,197 one year ago. North Toronto, Cricket Club (C04) ranked second with a 6.1% increase in average price, bringing condominium values to $301,065 (up from $283,746). Downsview, Weston (W04) clinched third spot, with a 4.37% increase in average price to $173,083 in June 2009, up from $165,834 one year earlier. Mississauga’s thriving Port Credit community (W12) experienced a 2.63% increase in condominium values year-over-year – with average price hovering at $304,954. Bendale, Woburn, and West Hill comprise E09, where the average price of a condo appreciated 2.46% over figures reported one year ago to $201,830.
“But that was then and this is now,” says Polzler. “Lower inventory levels combined with increased demand – comparable to what we’ve seen in recent months – is expected to place renewed pressure on housing values for the remainder of the year. As a result, average prices are forecast to be at par or slightly ahead of last year’s levels by year-end in almost all neighbourhoods.”
Case in point is areas like Toronto’s east end, where bidding wars are breaking out on single-detached properties daily. The average sale-to-list price ratio in E01 and E02 approaches 100%. Average prices are up in four of the 18 East District neighbourhoods. Overall average price in the east is down less than 1% to $346,597 from the January to June 2008 figure.
The areas with the highest percentage decreases in the average price of a single-detached home have also seen the greatest increases in the number of properties sold. The overall average price of a single-detached home fell by 5.17% in the Central District to $884,036, down from $932,198 one year ago, while the North District dropped 4.49% in value to $526,693, down from $551,452 in June 2008. Sales are up in both areas, with 2,000 homes changing hands in the central area (up 4.28% over one year ago) and 4,249 properties sold in the north (up 3% from June 2008).
Only one district reported an overall increase in the average price. Condominiums in the North District – comprised mostly of York Region – posted a 0.26% increase in values – and now hover at $275,822, compared with $275,113 one year ago.
“The momentum going forward is expected to be healthy – buoyed by positive economic data and a return to stability in the financial sector,” says Polzler. “There may be some bumps along the road, but all in all, the worst is over for the residential real estate in the Greater Toronto Area.”
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