Housing Market in Toronto and Across Canada in December was Hot, Hot, Hot!

Everyone expected that December would be a good month in real estate, but many did not expect it to be this good. Since June of 2009, the housing market in Toronto and across Canada has been surging forward, making record gains and erasing the falls felt in late-2008 and early-2009. December continued that trend to a much higher degree and that gives much hope for the real estate market in 2010, which is expected to continue to grow.

 Sales of existing homes across Canada in December rose by 73 percent over the previous year, while in Toronto home sales increased by 115 percent and the price of homes increased by 14 percent over the same levels seen in December of 2008. Now, it should be noted that in December of 2008, home prices had fallen drastically so the gain can be misleading, but what is not misleading is the fact that the housing market in Toronto and Canada is improving immensely.

 The average price of detached bungalows in Canada in December was $315,055, which is a six percent increase over prices in 2008. The price of two-storey homes increased by 5.2 percent to come in at $353,026, while condo prices rose by 6.4 percent nationwide to $205,756.

 Both Toronto and Vancouver saw big declines in late-2008 and early-2009, but both these cities now lead the country in the growth of their real estate markets. Over 250 Canadian neighborhoods were analyzed recently to see how they faired in 2009 and neighborhoods in Toronto and Vancouver faired the best when compared with other cities that have not seen as impressive gains.

 Going into 2010, housing prices should rise by about five percent and many expect that home sales will also increase. However, more condos and homes are being built and that will cause the housing market to stabilize. Right now it is a seller’s market because there are more buyers than there are homes. This causes bidding wars and as a result, home prices increase. Once more homes are built and the interest rate rises in June, then the entire market will stabilize. It is highly unlikely that we will see the same impressive gains we saw in the third and fourth quarters of 2009 in the same period in 2010. However, that being said, we should still see growth and any type of growth is better than a fall.