The Toronto Real Estate Board recently released highlights of the economic summits specifically for York and Durham Regions. As two large, neighbouring regions, we thought it’d be interesting to compare them with regards to what to expect from the residential real estate market in 2019.
“Although we won’t experience record levels, we do expect to see a better year in 2019 for sales and selling prices reported by GTA REALTORS® through TREB’s MLS® System,” says TREB President, Garry Bhaura. “Many buyers who moved to the sidelines over the past year due to various government policies, including the OSFI-mandated mortgage stress test, have reevaluated their positioning in the marketplace vis-à-vis home type, location and price point. It makes sense that Ipsos, in its Home Buyers Survey conducted for TREB, found that the share of intending home buyers has increased.”
TREB is predicting there will be approximately 83,000 home sales in the Greater Toronto Area reported through the MLS system this year. There is not an exact forecast for the amount of sales we’ll see in Durham, but the region has accounted for 11.5% of total sales in the GTA in the last decade. York has accounted for slightly more sales with 18% over the last decade, but last year, sales dipped to a 15% share. It’s probably safe to assume York will have more home sales than Durham this year.
Average home prices in both regions are primarily driven by the low-rise sector. TREB expects the overall average home price in the GTA to be around $820,000 this year. With detached home price growth slowing, TREB predicts prices will remain steady in both York and Durham. Prices aren’t plummeting, they’re just not skyrocketing like they were in recent years.
When it comes to the mortgage stress test, those buying in Durham on average had to qualify for payments that were $400 to $600 higher than their actual monthly payments. In York, it was even more difficult to qualify, having to afford payments of $650 to $1,000 higher. The high prices in York may lead to lower sales this year.
Across the 905 regions, TREB found that 26% of the survey respondents were at least somewhat likely to buy a home this year. In Durham, this share came in at just 20%. It looks like people looking to buy in York are slightly more confident with 29% at least somewhat likely to buy.
First-time buyers in the 905 area also remain confident with 32% saying they are at least somewhat likely to buy a home in 2019. The share was lower in Durham with only 29% feeling that they are at least somewhat likely to buy. First-time buyers will be even less active in York with only 24% saying they are at least somewhat likely to buy this year.
It looks like supply may outpace sales this year in York and Durham. TREB found that 37% of respondents in the 905 area are at least somewhat likely to list their home in 2019. In Durham, the share was 29% and York was more on par with the rest of the 905 with 36% at least somewhat likely to list.
“Despite some uncertainty regarding economic growth over the next year, many traditional housing market drivers remain in place,” says Jason Mercer, TREB’s Director of Market Analysis and Service Channels. “The GTA population will continue to grow over the next year, as people are attracted to the GTA by the region’s diversity of job opportunities. Unemployment is expected to remain very low and homebuyers are expected to benefit from lower fixed mortgage rates, on average, compared to 2018.”