On the heels of another , the appetite for low-rise housing in Toronto\u2019s suburbs might be on the precipice of decline.<\/p>\n
In February, the average price of a detached home in the 905 increased by a whopping 27.8% to $1,300,853, according to the Toronto Regional Real Estate Board (TRREB), while the average semi-detached home rose by 25.6% to $932,551.<\/p>\n
\u201cPeople are buying at the peak, so it\u2019s not sustainable,\u201d said Davelle Morrison, a broker with Bosley Real Estate. \u201cThose numbers are so drastic that, a few years from now, I\u2019m not sure buyers will get their money back. That\u2019s why I\u2019m more afraid for the suburbs than Toronto.\u201d<\/p>\n
In many ways, the regional housing market is reverting to 2016-17 when unsustainable valuation rises brought the party to a screeching halt. Last month, detached homes in Durham, Halton, York and Peel Regions rose on a year-over-year basis by 28.92%, 25.51%, 20.23%, and 19.16%, respectively.<\/p>\n
History doesn\u2019t repeat, but it sure rhymes.<\/p>\n
\u201cIn 2017 and early 2018, the houses in the suburbs north of Steeles Ave. weren\u2019t selling because they were priced around $1.2-1.3 million, especially in Markham and Richmond Hill, and the market just stopped in York Region,\u201d said Morrison, \u201cbecause people recognized that, if they were going to spend that amount of money, they might as well live in Toronto rather than the suburbs.\u201d<\/p>\n
Townhouses in the 905 also increased substantially, surging by 20.3% year-over-year in February to $845,518, and while that may still be somewhat digestible, the scarcity of townhouses suggests their purchase price will rise quickly. The average price of a condominium in Toronto\u2019s suburbs only climbed by 5.4% last month from a year earlier to $563,587\u2014a wholly reasonable number.<\/p>\n