Toronto just saw its strongest year-over-year home price growth since December 2017, according to the latest figures from the city’s real estate board.
Lower supply levels combined with intensified demand pushed the city’s benchmark home price up by 5.2% annually last month, ending up at roughly $805,500. Much of this hunger is stemming from lower interest rates and immigration-driven population growth, TREB added.
The September uptick brought the benchmark price close to the historic peak seen in 2017, being just around $10,000 lower than TREB’s record-high reading.
Meanwhile, the average home price grew by 5.8% to $843,115 – indeed, the highest seen so far this year.
Active listings fell by 14% annually to 17,254 units, while sales accelerated by 22% during the same time frame to 7,825 transactions. Detached homes drove much of the dynamism, with a 29% increase in sales.
Toronto’s prices have remained at inflamed levels over the past few years. A recent study by real estate information portal Zoocasa found that as of August, Torontonians earning at the market’s median level of $78,373 would have qualified for a mortgage valued at $300,174.
The Greater Toronto Area’s average home price of $802,400 means a shortfall of $502,226. Assuming a savings rate of 20% of annual income, mid-income buyers will need a staggering 32 years to fully pay for their houses.
Nationally, earnings at the median level (before taxes) stood at $70,336. These consumers will qualify for a mortgage of $280,703.
With a shortfall of $346,697, mid-income households across Canada will need around 25 years to save up for a home valued at the national average $627,400.