Will the housing market kick into high gear this fall?By Sam Reiss on Aug 28, 2019
The next time you hear from me, it will be September. Kids will be back in school and families everywhere will consider summer over. Honestly, I’m kind of looking forward to it.
Not because summer has been awful - it’s actually been pretty good weather wise. And the housing market has rebounded to healthy levels during a traditionally slow period. That’s why this time of year is exciting for me. The end of summer/beginning of fall is when the housing market picks up steam.
During the summer, new home sales spiked on a year-over-year basis, according to the Building Industry and Land Development Association and Altus Group. When the mortgage stress test was introduced at the beginning of 2018, people stepped onto the sidelines to see how the market would be affected. This type of reaction is also one of the effects on the market because many people who could still afford a home even with the stress test weren’t buying.
That time seems to have passed. The federal government, Canada Mortgage and Housing Corporation, and the Office of the Superintendent of Financial Institutions stuck to their guns and kept the stress test as is, even with numerous members of the real estate industry calling for either the elimination or adjustment of the policy.
When it comes to the opinions of leaders in the new home industry, I tend to trust their judgement, and while I do believe there should be some flexibility with the stress test in the future, I can’t help but admit that it seems to have worked out up to this point.
In July, Candian home sales increased for the fifth consecutive month, led by strong activity in the GTA. The national average price also increased 4% compared to the same period a year ago. So on a national level, prices increased and sales activity increased, despite the stress test.
Things were looking good in the Greater Golden Horseshoe last month with home prices up 6.9% in Guelph and 5.9% in Niagara Region. The Hamilton-Burlington area and Oakville-Milton both had 5% increases in home prices, and the GTA followed with a 4.4% increase. The only place with a price drop was Barrie, which decreased 1.3%.
If we’re seeing a rebound in the summer, I’m eager to see how fall shapes up. I’ve also heard of a few exciting new home projects that are supposed to launch next season.
Altree Developments is collecting registrations for Thirty Six Zorra in Etobicoke, which is a new 35-storey condo on The Queensway. Then there’s an interesting Collingwood project by Sherwood Homes planned to launch this fall; it’s an adult lifestyle community called Royal Windsor.
Another one I’m excited to learn more about is Daniels’ The Thornhill in Vaughan. The first phase of the four-building development is expected to launch soon. I also have my eye on Urban Capital and Spotlight Development’s Reina Condos in Etobicoke. They recently hosted a design workshop with mostly women on how to improve condo life for women, so I’m eager to see the results of the consultation. I heard we might get a sneak peek soon. I also happen to know about a few Fieldgate openings that are in the works.
Summer may be coming to a close, but the year has so much in store for the GTA’s housing market. I can’t wait for the leaves to change and real estate activity to kick into high gear.