Toronto Housing Market Forecast

Big Rise in Toronto Home Prices

Big demand combined with limited resale housing supply in the Greater Toronto area resulted in a disappointing home sales volume in December. December to December however, home prices grew 24.2% to a new median of $1,157,849. Seasonally adjusted, the new meidian price is above $1,200,000.

Throughout 2021, low mortgage rates, rising income and employment contributed to stronger demand from buyers. It’s clear that demographics and immigrations are having an impact on demand and pricing too.

Sales of single-family houses grew 34.1%, attached home rose  34.2% and townhouse sales rose 27.5%, along with apartments rose 24.2%.  The regions with strongest sales were in the 905 and 705 area codes including Durham region (+42.3%), South Simcoe County (Bradford West Gwillimbury and East Gwillimbury + 37.8%), and in York Region (Markham, Aurora, Newmarket,  Richmond Hill +36.2%).

Whitby, Georgina, Milton, and Oshawa had the highest price growth in cities, all above 43% year over year.

Screenshot courtesy of TRREB.

Demand is so intense now in the GTA, that homes only stay on the market for 18 days on average, down from last December when they sat for 35 days, an almost 46% decline. Days on MLS listing dropped to an 14. TRREB’s home price chart shows prices climbing at a near vertical rate for the last 12 months.

The usual seasonal trends in real estate have disappeared as buyers look to buy whenever the opportunity appears. As construction of homes returns in the spring, sales will pick up. The Federal Governments new $4 billion Housing Accelerator Fund is looking to build 100,000 new “middle-class” homes by 2025.  CMHC reports that SAAR housing starts across Canada was  301,279 units in November, an increase of 26% from 238,366 units the previous month.

The latest TRREB housing market report shows last month was a new record for November, and that prices have hit a new all time high. As the Omicron virus recedes, there will be little to stop the Toronto real estate market from exploding, other than a lack of inventory.

TRREB President Crigger reiterated his concern that government is not doing enough to support housing construction and availability. The message is one of worries of out of control home prices. And Jason Mercer, TRREBs chief economist says there is a lot of confidence in Toronto’s economy and demand will not go away. The fundamentals of home buyer demand will only grow in 2022.

Toronto Housing Market Forecasts 2022

Royal Lepage predicts price growth will reach 11% in Toronto this year, with condo prices even hotter at 12% growth. Phil Soper reiterated the fact that Toronto and Canadian home shortage situation cannot be solved overnight. The fact is, the shortage will steepen, and with rising incomes and rates remaining low, that demand will be brisk in 2022.

What’s chronically understated in the outlook is the US, Canadian and Global economic recovery. 2021 saw rising employment, strong housing demand and mobility along with rising wages. With vaccine boosters and Covid treatment pills available, the pandemic’s grip of fear will ease and all markets will return in 2022.

Within the GTA region, home prices in the final quarter of 2022 are forecast to rise another 11.0% to $1,256,500. The median price of a single-family house s expected to grow 10% to $1,564,200, and condos are predicted to rise another 12% to $763,800. With fewer houses available, buyers will turn to the lower priced housing market.

Royal Lepage’s 2022 Predictions

Home Prices Forecasts 2022 for Toronto Montreal Vancouver. Screenshot courtesy of Royal Lepage Report and Forecast.

Remax 2022 Toronto Housing Forecast

Remax forecast home prices in Toronto will rise 10% in 2022 to a new level of $1,160,491.

Screenshot courtesy of Re/max.

The GTA Toronto Market

TRREB reports the MLS® Home Price Index Composite Benchmark rose an astonishing 24.2% over the last 12 months. Only a housing market crash could cool that trend.  In November, The MLS® Home Price Index composite benchmark rose 28.3% YoY.  The average home price rose 21.7% vs last November to $1,163,323.

GTA REALTORS® reported home sales increased 3.3% year over year (9,017 transactions) setting the new record. New listings however fell 13.2% YoY.

GTA Housing Sales December 2021

Screenshot courtesy of TRREB.

The average price for all home types combined was $1,062,256 – up 12.6% vs 12 months ago while prices for single detached houses hit $1,405,478.

Screenshot courtesy of TRREB.

See the detailed price chart for Toronto districts below.

This strong upward pressure on home prices will be sustained in the absence of more supply, especially as we see a resurgence in population growth moving into 2022,” said TRREB Chief Market Analyst Jason Mercer.

Right now is a good time time to sell your home. And you can sell your home fast with perhaps no commission, or sell it for more with a Realtor. Big demand and bidding wars means no price is too outlandish. Buyers are desperate.

The Toronto condo segment has recovered well and is expected to continue given the shortage of units, the demand from new immigrants, returning workers to the high density housing in GTA urban areas (Toronto).

Toronto Home Price Charts for December

Screenshot courtesy of TRREB.
Screenshot courtesy of TRREB.

“There has been strong demand for ownership housing in all parts of the GTA for both ground-oriented home types and condominium apartments. This was fueled by confidence in economic recovery and low borrowing costs. However, in the absence of a normal pace of population growth, we saw a pullback in sales over the past two months relative to the March peak,” said TRREB President Lisa Patel.

GTA Prices

King, Markham, Brampton, Toronto Central, King, Whitchurch/Stouffville saw big gains in house prices while Bradford, Brock, Innisfil, Milton, Halton Hills, and Burlington suffered sizable losses in price.  It seems buyers cannot find the houses they’re hoping for far from the city, or they are having issues about the commute to Toronto to work.  See more on the Toronto condo market report. As we progress to summer, condos will become the big Toronto housing market story. But for now, houses are the object of everyone’s affections.

Take a look at the home price rises of the last 4 years. This is the shocking stat that most buyers and politicians have lost site of. This really is an election issue, as we head to even higher prices and less housing supply in the GTA. GTA housing stats courtesy of TRREB.

City of Toronto Condo Prices

Screenshot courtesy of TRREB.

GTA Towns and Cities Condo Prices and Sales

Screenshot courtesy of TRREB.

Interestingly, TRREB’s research partner believes zoning restrictions are the top problem darkening the Toronto housing market outlook.

Is a housing market crash even thinkable, given the recovery is so near?  Is a quick downturn more likely in 2022 as government stimulus in the US dries up?

Work from home won’t end as employers will cringe at continuing to pay Toronto commercial office rents and are buoyed by the lower cost of remote working.  Yet the exodus from the inner city in Toronto will slow as practical issues of high home costs, lack of home supply, and distance to the office take over.  Condo sales and prices are already starting to recover.

The lack of housing supply is making finding a home in the GTA very difficult. It is real estate in Vaughan, Bradford, Newmarket, Aurora, Richmond Hill, Milton, Stouffville, Pickering and Whitby that everyone is after.

Interestingly though, CMHC with its Toronto real estate market crash style scenario. CHMC said Toronto (and Vancouver homes) are highly overvalued and a drop of prices in the neighbourhood of 20% is coming.  With all due respect to CMHC, they should avoid looking at fundamentals, because human market demand is an emotional thing.

With mortgage rates so low, there’s a desperation among young buyers to buy and lock in at low rates.

With mortgage rates at historic lows and loan refinancing still frequent, the market is loosening up. However, with Covid still actives, US trade tensions heightening, and the US election in two months, we’re hearing more talk about a housing market crash. And a Toronto housing market crash is possible if the US economy should collapse.

As you can see in the monthly Toronto GTA region prices and sales details, upward momentum is strong.  The growth in prices in each regions is astonishing and there is little to suggest it will slow into the fall season.

See more on the Vancouver real estate market, Calgary real estate market, Okanagan real estate market and the York region real estate market.

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2021 Canadian Housing Market Forecast

For context for Toronto real estate market against the rest of Canada’s Property markets, is this chart/forecast from TD Bank. They’re predicting a very big return of home sales in 2021, yet moderate price gains for the most part. Toronto’s outlook looks best with a slightly lower price rise.

Screenshot courtesy of TD Bank.

Compare Toronto’s property market outlook to the US housing market forecast.  You can view the prices for each city and MLS district below. Also, keep an eye on Toronto condo prices as the pandemic passes.

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Homebuyers are still willing to look beyond the green spaces belt, but they’ll look at Aurora, Bradford, Stouffville, and Newmarket first before heading north.


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