The real estate market in York Region remains hot in 2021, with prices and sales continuing to climb, and here are five newsmakers to reflect this year’s trend.
Imbalance between supply and demand
The latest data from the Toronto Regional Real Estate Board shows that home sales reached a record for the month of November and the average selling price also reached an all-time high. New listings were down substantially compared to last year for all market segments — further highlighting the inherent supply issue in the Greater Toronto Area, including York Region.
Number of sales in York Region reached 1,583 in November, which is up 36.1 per cent from the same time last year. Meanwhile the number of new listings was 1,796, a decrease of 11.6 per cent compared to 2020.
According to Re/Max’s housing market report, home sales are expected to rise and factors like decreasing inventory and new listings, increasing immigration and domestic demands will continue to exacerbate the imbalance between the supply and demand.
Bidding war is normal
Due to the substantial insufficiency of supply to demand, bully offers and bidding wars are commonplace in the current market.
“Homes sales this year often receive double-digit offers,” said Yinan Xia, broker and managing partner of Bay Street Group in Markham. “In some extreme cases, our team received up to 80 offers for a single property.”
Xia analyzed and pointed out that COVID-19 hit the hotel and retail industries hard, which investors used to be enthusiastic about. As a result, people turned their attention to residential housing, bringing together a wide variety of buyers and fierce competition.
People flock into remote areas
The pandemic has completely changed the way people work and live. “More transit options and hybrid work schedules have made relocation to the city’s outlying areas more attractive,” said Christopher Alexander, senior vice-president of Re/Max. The beneficiaries of the trend have been suburban communities, including the most northern part of York Region.
Statistics show that East Gwillimbury home sales jumped 145.3 per cent to 444 units in the first half of year of 2021, compared to 181-unit sales during the same period in 2020 while Georgina climbed 90.4 per cent, from 710 to 373.
Recreational property is the new favourite
Vacation properties are getting more valuable and popular, especially for families who work remotely and have children at home. Except for affordability, proximity to water or waterfront, space and comfort, amenities and good Wi-Fi remain the top buying criteria for people in the market for a recreational property.
For York Region, the rising heat of Wilcox lakeside homes in Richmond Hill is a good proof of this trend.
“Two cottages facing the lake, the price of a four-bedroom house in July 2020 was only 2.16 million; however, in September 2021, the one with only two bedrooms sold for two million,” Tommy Hua, salesperson from Real Land Realty Inc., illustrated by example.
Vacant homes tax considered in York Region
The region is considering vacant land tax to dampen speculative activities and help release more housing units, but Jason Mercer, chief market analyst of TRREB, doubts that will make a substantive difference as the most fundamental issue is the problem of supply and demand instead of speculation.
Re/Max looked at over 5,000 individual freehold transactions in the GTA between March 2019 and March 2021. Aurora was one of the six neighbourhoods that saw less than two per cent of sales repeated in that period — leading to the conclusion that speculators are not a significant factor driving the current market and rising prices.
TRREB president Kevin Crigger agreed with Mercer and insisted that governments at all levels must take coordinated action to increase supply. “Unless governments work together to cut red tape, streamline the approval processes, and incentivize mid-density housing, ongoing housing affordability challenges will escalate.”
Scarlett Liu is a federally funded Local Journalism Initiative Reporter at Economist & Sun
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
