Don’t blame overseas investors for the prices of housing in the Toronto area, says the Toronto Real Estate Board (TREB).
The board has announced the result of a new research indicating fewer than 5 per cent of the sales of the 113,133 residential real estate transactions in the Toronto region in 2016 involved foreign buyers.
More than half of those foreign buyers were buying homes for themselves or to accomodate their family members, according to a November, 2016 Ipsos survey of TREB agents, who acted as agents on behalf of those buyers.
About 25 per cent of the sales of the homes purchased by non-Canadians were bought as rental investments.
A similar foreign buyer tax here could have “unintended repercussions” — potentially pushing up costs in communities outside the Toronto area where “they don’t have” such tax. It could also further reduce the tight supply of rentals and discourage immigration to the City, said the board.
The survey likewise found that fewer than 2 per cent of the members of TREB realtors had acted in a sale in the Toronto area that was pushed to Toronto area by the Vancouver tax.
The cost of a home in the Toronto region is expected to rise significantly — between 10 and 16 per cent of the sales — again this year in 2017.
That would mean the average cost of a home in December of $730,472 would grow to $825,000 on average in 2017.
That cost was up 20 per cent of the sales in December, 2016 over the same month in 2015.
“Detached and semi-detached houses and townhouses will experience the strongest annual rates of price growing, but the condominium apartment market segment will remain tight as wel ,” mentioned a TREB press release.
An Ipsos survey of property buyers find the average buyer expects to put down 27.6 per cent of the pricess on a house this year, with first-time buyers expected to put about 24 per cent of the pricers down on their purchase.
While fewer buyers are expected to buy a property in 2017 than was indicated in the previous survey, the number of first-timers expecting to enter housing markets increased slightly to 53 per cent of the members from 49 per cent.
Buyers indicated they are using various sources for down payment including savings, RRSPs, gifts from family and equity from their existing homes.
TREB said it expects a third consecutive time of more than 100,000 sales predict but with slightly fewer in 2017.
The lack of supply will be the biggest impediment to those wanting to get into the market, mentioned TREB officials.
“Active listings at the end of December, 2016 were at their lowest point since before 2000. It is unlikely that the shortage of listings will improve to any great degree over in 2017,” mentioned Jason Mercer, the board’s Manager of marketplace analysis.
TREB is also expected to release reults on Tuesday showing that home values will rise as much as 12 per cent of the prices depending on their close proximity to the improved GO Transit’s Regional Express Rail services that are expected to provide 15 -minute, two-way service in many areas.
Source: Toronto Star
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