Are Toronto Housing Prices Up or Down?
There is a lot of conflicting information floating around, it’s hard to know for sure what’s going on with the real estate market these days.
One recent report declared that the price of an average house was at an all-time high, while another warned that prices have been in steady decline over the past five months.
So where does the Canadian real estate market stand in all this? Or is that even the right question to ask?
Common wisdom reminds us that when we ask the wrong question, we get the wrong answer
In reality, there is no such thing as a “Canadian” or an “American” real estate market. Nobody buys homes “nationally”. Rather, we buy homes in specific cities, towns and neighbourhoods. And whether prices in general are going or down, the bottom line for most buyers is: What’s happening with prices in the area I’m interested in?
In some areas of the U.S., prices have dropped as much of 50 per cent following the financial crisis. However, there many large metropolitan areas, such as San Francisco, Las Vegas and Phoenix, where bidding wars are back and buyers are paying more than the asking price.
In Canada, MLS figures showed the average national home price for May set a record high of $319,757, up a substantial 16.4% from January.
Yet Phil Soper, chief executive of Royal Le-Page Real Estate Services Ltd., was philosophical about the new data. “You can’t argue with the accuracy of the number,” he said, “but you can argue that the number misrepresents what’s happening in the marketplace.”
According to Soper, home prices have remained pretty much the same since January, but when comparing sales on a monthly basis, seasonal factors affected the results. For instance, many winter-time home sales were distressed sales, which artificially lowered the average house price.
All in all, compared to this time last year, the CREA data shows average home prices as flat.
However, home prices in central Toronto neighbourhoods such as Leaside and Davisville Village are on the rise again. If history repeats itself, we can expect home prices there to continue to rise.
Stay tuned for more updates on home values in these and other desirable neighbourhoods!
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