New TREB Report Shows Foreign Buyers Have Minimal Effect on Toronto Housing Market

Foreign Buyers Not Driving Up Prices in Toronto

A new Toronto Real Estate Board investigation has concluded that foreign buyers play a minimal role in Toronto house prices and availability. 3 key findings counter the Wynne government’s insistence that Foreign buyers and house flippers are ruining the housing market.

The report may indicate how government officials haven’t been honest to the public about the cause of high home prices in Toronto — government tax greed and ideology of privilege.

April TREB market report: a growth of 33.6% in home listings in the TREB’s MLS® System in April 2017, at 21,630. Prices rose too.

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This new finding shows the Foreign Buyers Tax in Toronto (an old school knuckle dragging approach) was a knee jerk reaction by desperate politicians. The sad part is that it could cripple the development of new homes and condos in 2018 and 2019 which would have eased the housing crisis.




It remains to be seen how Toronto condominium developers will react to the Ontario government buyers tax. Currently, the Toronto condo market is alive and healthy. But the housing crisis is unfortunately a sad reality for many Ontarians.

What happened in April 2017?

The MLS® Home Price Index (HPI) Composite Benchmark Price was up by 31.7 per cent year-over-year in April 2017. Similarly, the average selling price for all home types combined was up by 24.5 per cent to $920,791. — from report from TREBhome.com




Homeowners are Finally Selling!

On a positive note, and further to the real point of the study, TREB reported that home sellers appear to be loosening their grip on their homes and are putting them up for sale. The long awaited “Great Home Release” is happening now this spring 2017 in a Toronto neighbourhood near you.  tTREB’s Jason Mercer added in the published statement that it will take a long time for the pent up demand to be fulfilled in the GTA area. from the new May report from TREB.

It was encouraging to see a very strong year-over-year increase in new listings. If new listings growth continues to outpace sales growth moving forward, we will start to see more balanced market conditions. It will likely take a number of months to unwind the substantial pent-up demand that has built over the past two years. Expect annual rates of price growth to remain well-above the rate of inflation as we move through the spring and summer months,” said Jason Mercer, TREB’s Director of Market Analysis.




“TREB strongly believes that public policy decisions with regard to the housing market should be evidence-based and supported by empirical data.”

3 Key Findings that Debunk the Foreign Influence Myth

TREB’s Report summarized these 3 key findings, that debunk the Ontario government’s insistence that foreign buyers and quick investment flips are driving the Toronto housing crisis:

  1. The number of buyers with a mailing address outside of Canada is well-below 1%
  2. Between 2008 and April 2017, the average share of foreign buyers in the Golden Horseshoe area was 2.3%
  3. The majority of foreign buyers – 87% to 90%– purchased their home as a place to live, not as a tax evasion or speculative venture (homes that were bought/sold within a short period of time – within one year of the original transaction by domestic or foreign buyers accounted for a very small share — less than 5% in 2016 and 7% between January and April 2017) of total transactions).

With the above information in hand, what is your opinion of the Ontario government and Mayor John Tory’s stated preference for the Toronto Foreign Buyers Tax? What do you believe is the real purpose of the tax? Will the incoming Ontario government simply get rid of it?  Do you consider the Toronto land transfer tax a fair tax? Do you feel the government is creating the problem with one hand and justifying its role with the other?

Get the full view of the Toronto Real Estate market, along with the Newmarket housing report, and Mississauga housing market report and forecasts.

Should you sell your house fast or for a high price?  In the past 3 months Americans have been selling their home for an average $336,000 more than they paid for it. It’s one more reminder that real estate is where the real money is. And if you’ve been reading my posts, you’ll see that government red tape and land restriction is the real driver of high real estate prices. So if you’re renting, gaining no equity, while your life passes, and can’t come up with hundreds of thousands for a down payment, now you know why. It’s time to speak with your local government representatives about opening up land for development. The alternative is pay the future home prices which could rise another 30% in 2018 (depending on the economy and how well J Trudeau gets along with you know who).

Latest year over year Toronto region home prices (April 2016 to 2017):

Screen Capture courtesy of TREBhome.com




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Average Profit on Home Sale = $356,000

How Does Making 71% Profit on the Sale of Your Home Sound?

A new report from ATTOM Data Solutions shows that homeowners across the US are receiving a huge winfall from selling their homes in 2017. The City with the best ROI? It was San Francisco which returned a whopping 71% profit for home sellers, or an average of $356k.

The average profit across the country was an amazing 44%. And just this first quarter, sellers earned $44k more in ROI — the best performance in a very long time. The stats make it hard to argue that real estate investment is how you create wealth today. When you consider how long the housing market has been depressed, it might not be a surprise. But what could surprise you is that this housing market isn’t done yet.




The ATTOM Data Solutions report shows 20 of the top US cities for homeowner profit. It seems 2017 is the year of the seller and hundreds of thousands of people will be selling their house for a fortune and moving on with their lives. But where are they all headed if there are so few homes available? Chances are they will be relocating to southern or tropical destinations or at least to cheaper cities here in the US.

If you’re in the market for selling and looking for a destination, check out International Living — the source for Caribbean, Mexican, and Central American relocation. You’ll be joined by thousands of Toronto and Vancouver home sellers who will be cashing out in 2017.

The 1st quarter of 2017 is proving to be the most profitable time for price growth.  In the video below, an expert believes there will be no bubble or crash in the market. He believes the economic and demographic fundamentals support ongoing growth in housing.

The first quarter of 2017 was the most profitable time to be a home seller in nearly a decade, and yet homeowners are continuing to stay put in their homes longer before selling,” said Daren Blomquist, senior vice president with ATTOM Data Solutions.

 


Homeowners throughout the San Francisco Bay Silicon Valley were the biggest gainers. The phenomenal economy along with a shortage of developable land has created a market where the price could only go up and fast. And the fundamentals of even higher prices are still in play. Housing starts are not expected to ease the issue and there are no homes for sellers to move up to.

That reluctance or inability to sell and move on is one of the key factors in today’s overheated housing markets.

The report showed 13 of the top 20 markets were in California and Colorado. This might reflect trends in wealth and population if not economic growth.

Top 20 US Cities for Home Sales Profit
City Average Profit
20 Port St Lucie, FL $53,000
19 Austin Round Rock, TX $81,795
18 San Diego, CA $144,400
17 Riverside San Bernardino $90,000
16 Boston, CA $111,000
15 Oxnard Thousand Oaks, CA $166,000
14 Sacramento, CA $99,000
13 Fort Collins, CO $97,500
12 Greely, CO $85,050
11 Honolulu, HA $161,000
10 Salem, OR $70,800
9 Vallejo Fairfield, CA $115,000
8 Denver Aurora, CO $110,000
7 Los Angeles $187,000
6 Stockton Lodi, CA $101,000
5 Modesto, CA $875,000
4 Portland Vancouver, OR $110,800
3 Seattle, OR $139,300
2 San Francisco Oakland, CA $276,750
1 San Jose Sunnyvale, CA $356,000

How About Best Cities for Rental Income?

There are plenty of cities with potential in rental property investment income. Attom Data reported these US counties:

Counties with the highest annual gross rental yields were Clayton County, Georgia (Atlanta metro area) (23.7 %); Baltimore City, Maryland (23.6%); Macon County metro area (23.5%); Monroe County, Pennsylvania, (20.65); and Saginaw County, Michigan(18.8%).




Latest Top Blog Posts: Rise of the Smartphone SurferBest Real Estate Investment | Home Price Forecast | Los Angeles Housing Prices | Toronto Home PricesToronto Housing Market | Los Angeles Housing Market | Toronto Condo MarketLead Generation | New Homes for Sale in Newmarket | New Homes for Sale in Aurora | York Region New Construction |Aurora Luxury Homes | Mississauga Real Estate Report | Toronto Auto Insurance |Vancouver Auto Insurance | Bradford West Gwillimbury Homes | Best Investment Opportunities | US Housing Crash 2017 | When is the Best Time to Buy a House? | When should I Sell My House? | RETS IDX | Zillow Home Search

 

 

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