Last Updated on October 24, 2023 by Neil Sharma
Housing prices in major Central Canadian markets saw double-digit growth last quarter, according to a new report from Royal LePage.
Greater Toronto Area
In the GTA, aggregate home prices were up by 13.1% year-over-year in Q1 to $989,961. Two-storey homes saw 13.6% price gains to reach $1,164,894, and while bungalows rose by 15.3% to $982,120, condominiums only climbed 1.2% to $598,819.
In the City of Toronto, the overall price of a home rose by 7.4% year-over-year to $984,709 in Q1-2021. Two-storey homes were up by 11.8% to $1,550,577 and bungalows increased by 14.7% to $1,061,534, but the median price of 416 condos declined slightly by 0.6% to $637,551.
In the report, Debra Harris, senior vice president of Royal LePage Real Estate Services Ltd, noted that sellers do not feel confident about securing their next homes because listings don’t last long on the market.
“Typically, we measure absorption—how long it would take to run out of inventory—in months. At the moment, we have an absorption rate in the GTA of about three and a half weeks. The number of new listings added each month is lower than the pace of sales, and that gap continues to widen,” said Harris.
Royal LePage expects condo sales in the GTA to increase by autumn when the door reopens to immigrants and both domestic and international students return to school.
In Q4-2021, Royal LePage anticipates that the aggregate price of a GTA home will increase by 11% year-over-year.
Greater Montreal Area
Canada’s second-largest metropolitan region saw the average price of a home increase by 19.7% last quarter to $534,026, with two-storey homes surging 21.5% to $681,768, bungalows shooting up 20.2% to $420,699 , and condos increasing by 14.7% to $398,705.
In Montreal proper, the average price of homes rose by 11.1% year-over-year to $635,907 in Q1-2021. Two-storey homes in the city increased in price to a median of $888,021, up by 15.7% year-over-year, and bungalows increased 12.3% to $594,437, while Montreal Island condo prices averaged of $455,433, up by 7.8% last quarter compared from Q1-2020.
“One year after the start of the pandemic, residential demand has continued to grow in Greater Montreal and the number of single-family homes for sale on the market today is approximately half of the inventory we had before the pandemic,” said Dominic St-Pierre, vice-president and general manager of Royal LePage Quebec. “Multiple-offer scenarios continued to dictate market conditions in the first quarter, driven by the worsening supply of inventory and persistent buyer demand. Similar to what the Toronto area has been experiencing for years, Montreal is now also feeling the impact of chronically low supply.”
According to St. Pierre, working from home has allowed many buyers to save money that will be spent on home purchases, but the expectation is that, when lockdown measures are repealed, savings will decrease. Moreover, because Royal LePage doesn’t anticipate prices will decline in the Montreal metropolitan region any time soon and that could price first-time buyers out of the market.
Royal LePage forecasts the average home price in the Greater Montreal Area to rise by 16% in Q4-2021. Ottawa
The average price of a home in Canada’s capital grew by 16.1% year-over-year to $589,240 in the first quarter of the year, and broken down by housing type, two-storey homes were up 18.6% to $630,96, followed by bungalows rising by 15.1% to $604,931, and condos increasing by 5.2% to $385,040.
“Ottawa has a strong housing market bolstered by stable, healthy household incomes,” said John Rogan, broker of record at Royal LePage Performance Realty. “We are continuing to see very low inventory across all housing types; about 40% less than this time last year. Unless interest rates increase dramatically, I don’t anticipate the supply will be able to catch up with the growing demand.”
Royal LePage expects the average home price in the city will increase 14% year-over-year in the last quarter of 2021.
Neil Sharma is the Editor-In-Chief of Canadian Real Estate Wealth and Real Estate Professional. As a journalist, he has covered Canada’s housing market for the Toronto Star, Toronto Sun, National Post, and other publications, specializing in everything from market trends to mortgage and investment advice. He can be reached at neil@crewmedia.ca.
