The past five months may have felt like a bit of a rollercoaster in the housing market, but it's clear that the rebound is very real right now – particularly in the 905 region.
According to the latest data from the Toronto Regional Real Estate Board (TRREB), year-over-year sales growth in the Toronto-area this July was driven by low-rise home types, particularly in the regions surrounding the City of Toronto, with a large share coming from the 905 region.
In July, the 905 area outsold the 416 area in nearly every housing segment, with the exception of condo apartments. The hottest sales segment in the 905 area was detached homes, which were selling for 14% more than July 2019, with an average price of $1.06 million.
All other housing segments in the 905 area saw their average prices increase last month, with semi-detached homes up 11.2% to $773,513, townhouses up 11.1% to $701,853, and condos rising slightly by 10.6 to $527,117.
TRREB July 2020
What's more, while sales of detached homes across the GTA rose 43.7% in July, Toronto accounted for a 27.5% rise in sales while the 905 jumped a staggering 48.3%. The 905 area accounted for 4,531 detached home sales last month, 3,429 more sales than in the 416 area.
Zain Jafrey, a real estate agent with Coldwell Banker, which serves the 905 area, explains that there is currently an "overwhelming demand for housing and not enough supply, and that’s a big reason why we’re seeing the rise in prices."
"Right now properties are being listed below market value to attract multiple offers, which means they’re selling in a matter of days with limited to no conditions. Within the last year or so, we saw an increase in younger families moving from Toronto into the 905 because of affordability, and for the opportunity to upsize. Many home buyers were trading in their condos for more space. With the accessibility of the 407 and Go Transit, you can get into Toronto from Oshawa in less than an hour."
Case in point, Jafrey says, "the 905 housing market is on fire."
And what's interesting to note is that this data correlates with a recent report from researchers at Ryerson University’s Centre for Urban Research (CUR) which noted that the suburban markets, specifically those in the 905 area, surrounding Toronto are now outperforming the 416 area and a “dichotomy” is being set up between the two markets.
Jafrey has also noticed this shift in buyer behaviour. "During COVID I think a lot of people had the chance to reevaluate their living situation and realized that they needed more space. I had several clients moving from their condos in Toronto to a bigger space in Whitby and Oshawa. I’m currently noticing a big demand from first-time buyers looking to purchase properties throughout the Durham Region (Pickering, Ajax, Whitby, Oshawa, and Clarington). Many are looking to take advantage of the low-interest rates to purchase their first property."
However, because of the rising cost to buy, Jafrey noted that he is also starting to see an increase in the rental market, with properties now being leased within a couple of days on market, and are also now receiving multiple offers.
"A lot of people thought that the real estate market would slow down with the COVID pandemic, but it’s quite the opposite. We have a pent up demand for homes. Buyers who were unable to look for a home during the spring market due to COVID are looking for homes now along with buyers who were looking to purchase properties in the summer market."