Vancouver, Toronto real estate markets end year on sky-high note
Sales in both cities set records as prices continue to surge
The hot real estate markets in Vancouver and Toronto have posted record sales in a year that saw already stratospheric prices rise even higher.
Real estate boards in both cities released figures that showed 2015 was an especially busy year for agents. In Toronto, sales in the calendar year rose 9.2 per cent over the previous year to hit a record 101,299.
"If the market had benefited from more listings, the 2015 sales total would have been greater," said Toronto Real Estate Board president Mark McLean, in a statement.
"As it stands, we begin 2016 with a substantial amount of pent-up demand," he said.
That demand helped to drive the average resale selling price for the full year in the Greater Toronto Area to $622,217 — up 9.8 per cent from 2014. In the city of Toronto, the average selling price for all real estate types was $659,270. For detached houses, the average selling price in the city hit $1,039,658 in December, up 11.8 per cent in a year.
An alternative price measurement shows a similar price increase. The MLS home price index for the Greater Toronto Area, which measures the rate at which prices change over time by tracking price changes in "typical" homes, was up 10 per cent from 2014, to $573,500.
Huge price increases in Vancouver
The housing picture is even hotter in Vancouver.
The benchmark MLS home price index for all types of homes was $760,900 in December in Metro Vancouver. That's up a stunning 18.9 per cent from a year earlier.
The benchmark price for detached houses soared 24.3 per cent from December 2014 to $1,248,000.
Even though the number of homes listed for sale in Vancouver was below historical averages, home sales in the year hit a record 42,326, up almost 28 per cent from 2014 levels.
"We often hear economists say that sellers' market conditions put upward pressure on home prices," said Darcy McLeod, president of the Real Estate Board of Greater Vancouver.
"That was certainly the case in 2015, with price increases ranging from 14 to 24 per cent, depending on property type."
Property assessments in Vancouver are being raised up to 30 per cent as a result.
Tale of two markets
Vancouver and Toronto are the two main outliers in the Canadian real estate scene. Most other markets are showing much more modest price increases, or in some cases, price decreases, over the past year.
The Canadian Real Estate Association, for example, released data last month that showed the average resale home price was up 10.2 per cent from a year earlier. But if Vancouver and Toronto are excluded from the calculations, the average increase was just 3.4 per cent.
Calgary, which is feeling the effects of a badly slumping economy from the oil price crash, is seeing home prices fall as the supply of available homes surges. The benchmark home price in December fell 2.3 per cent from a year earlier, while the average price fell 2.6 per cent.
At year's end in Edmonton, realtors were reporting a surge in listings compared to the same time in 2014.
In December, the federal government announced changes to mortgage rules that would require larger down payments for those wanting to buy properties valued at more than $500,000.
But economists said the measure will likely have only a minor impact on sales and prices.