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Toronto's Housing Market Could Set Record Levels for 2016, Real Estate Group Says

Posted by Hannah Raissa Marfil on Jan 19, 2016 11:21 AM EST
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The CN Tower and the Skydome highlight the Toronto skyline in his undated file photo. The International Olympic Committee (IOC) meets in Moscow July 13, 2001 to decide between front runners Beijing, Paris and Toronto for the site of the 2008 summer Olympics. (Photo : Carlo Allegri/Getty Images)

Toronto, Canada's largest city, will likely see record levels in its housing market this year, according to market predictions made by the Toronto Real Estate Board.

The Toronto Real Estate Board foresees home sales from its member realtors this year to be between 96,500 and 105,000 properties, which will be slightly lower or higher than the previous year's record high transactions of 101,229 sales, according to a report from the Toronto Sun. The board also predicts the average home selling price to rise to between $655,000 and $665,000. This would be higher than the previous year's $622,217, which a 9.8 percent increase from 2014's levels. 

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Jason Mercer, director of market analysis for the Toronto Real Estate Board, stated that they expect 2016 to post record high numbers. However, it will also depend on the availability of housing stock in the market and borrowing costs. Meanwhile, the Canadian housing markets which saw strong demand last year included the Greater Toronto Area (GTA), as well as other parts of southern Ontario. Mercer also pointed out survey data compiled by Ipsos Reid for the real estate association, which showed that a minimal percentage of potential homebuyers would be affected by the revised and tightened mortgage lender rulings that were announced in December. 

The Ipsos Reid survey also indicated that most of the housing market transactions in the coming years would likely be by first-time homebuyers, according to a report from the Financial Post. In 2015, around 53 percent of the housing transactions in the GTA area were from first time home buyers (ages 18 to 34). The same trend is expected to continue in 2016.

Ipsos' Sean Simpson stated, "In the GTA, there is not an affordability issue."  He added, "If there was an affordability issue, it would prevent people from buying." 

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