By Imraz Ramani
Please be aware of the following housing market trends in Toronto.
The numbers comparing sales and prices in the GTA from June 2017 to June 2016 indicate that the prices of detached homes and condominiums are increasing, while the number of sales are going down. The average June sale prices in the GTA are reportedly close to $794,000, an 8% decline from a month prior. Despite this, we were still seeing prices up 6.3% from a year ago. However, from July 1 to July 14, the average selling price in the GTA was around $760,000. This means that prices have now fallen by more than $160,000 since April.
Data from the Toronto Real Estate Board also indicates that home prices in Toronto have decreased by 17.4% since peaking in April. This is a positive indicator that prices are continuing to fall.
Please also be aware that mortgage rates are increasing as of 6 July 2017. RBC has raised three-year fixed rates with amortizations of 25 years or less to 2.69%, an increase of 25 basis points. Four-year rates and five-year rates have gone up 30 points. The five-year fixed rates for mortgages that take more than 25 years have gone up by 40 points.
Finally, it should be noted that Canada has officially joined the US in raising interest rates. This raises concerns that the world’s central bankers are nearing a tightening cycle. The central bank’s benchmark rate has been raised from 0.5% to 0.75%. RBC, BMO, and TD Bank have announced that they are increasing their prime rates from 2.7% to 2.95%. The Bank of Canada predicts that rates will be close to 2% by the middle of 2018, which is up from the current 0.75%.
Imraz Ramani has provided a Full Service real estate experience to his clients since 2007. He graduated from Waterloo with a degree in Economics and Financing with a minor in Speech Communications. He can be contacted via email at firstname.lastname@example.org.