Toronto region housing prices could rise 5 per cent in 2020, CMHC report says
Canada’s national housing agency is forecasting Toronto region home prices to rebound in the next two years, rising as much as 5 per cent in 2020 to an average of between $765,300 and $898,400
This year is predicted to end with prices averaging between $740,600 and $854,600.
It predicts prices could average as much as $949,400 by the end of 2021, a 10.5 per cent increase over this year.
Sales and new home construction, led by the highrise sector, are also expected to fully recover after the market lull of the last two years, according to the annual Housing Market Outlook from Canada Mortgage and Housing Corp. (CMHC) released on Thursday.
The complex geopolitical landscape, including an upcoming U.S. election, trade wars and Brexit, made the report’s forecast among the most difficult. But those are the conditions that are also expected to keep interest rates low, said Dana Senagama, CMHC manager of market analysis for Ontario.
She said consumers can expect their monthly mortgage payments to remain stable through the end of 2021, the period covered in the report.
CMHC says the Toronto region market is heading back into more balanced and sellers’ territory thanks to high employment, the influx of immigrants and migration from other provinces.
Although policy changes such as stricter mortgage qualifications and a foreign buyers tax have slowed housing activity in the last couple of years, the resurgence of Toronto’s housing market was inevitable, said Senagama.
“We can play around so much with demand but the supply is so low. Our population continues to increase by 100,000 on average every year. There’s a lot of people moving into this region. They need a place to live. The supply simply cannot keep up,” she said, adding that speaks to the economic prosperity of the region.
Overall, the Toronto forecast aligns with the national picture. CMHC is predicting sales and housing starts will rise across the country with the national average home price reaching up to $569,000 by 2021, from the $488,000