If you thought Toronto’s real estate market was already pricey, home prices are expected to increase by 2020, according to a new report.
Royal LePage has released its annual Market Survey Forecast for 2020, which provides price projections as well as insights into trends that will impact the Greater Toronto Area (GTA) and national real estate markets next year.
The report revealed that for most regions, home prices are expected to appreciate at a single-digit rate in 2020.
According to the report, tight market conditions influenced by low supply and a growing population will continue to affect home prices in the city’s core and in the GTA.
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As a result of this, the aggregate price of a home in the GTA is forecast to increase 4.75% year-over-year in 2020, rising to $883,700.
When broken down by housing types, the average price of a condo is expected to increase 6% year-over-year to $600,000, while a two-storey detached home is forecast to rise 4.5% year-over-year to $1,027, 200 by the end of next year.
“Inventory is critically low and it is possible that we could see a return to accelerating high price appreciation in the near term without new supply becoming available,” said Kevin Somers, chief operating officer, Royal LePage Real Estate Services Limited.
“Areas such as Richmond Hill and Markham, which were among the hardest hit by the recent market correction, have already shown signs of a recovery while areas closer to the city centre are showing significant momentum heading into 2020.”
Somers added that while many young families are growing out of their condominiums, moving into a larger property is not an option that many can afford.
The First-Time Home Buyer Incentive may benefit single first-time condominium buyers, especially in the greater region, but it is unlikely to benefit buyers looking for a property suited for a family, unless modifications proposed in the liberal election platform increasing the qualifying purchase threshold to $800,000 actually take effect.