Toronto housing prices to double over next 25 years, study predicts
What are you waiting for ? Buy as many as you can afford and keep till end of time.
Just like gold, houses won’t rot … Yeah, right.
A new forecast suggests fears of a housing bubble and a price collapse are misplaced and predicts rising population and land supply restrictions will result in Toronto house prices doubling over the next 25 years.
The forecast by Central 1 Credit Union says higher mortgage rates in the next three years will restrain housing sales in Ontario as a whole, but not cause a market correction.
Ontario home prices will rise about 4% a year through 2016, down from a decade-long annual average of about 6%.
It also predicts the Toronto condo market will slow as builders delay new construction in the face of weaker demand.
Central 1 says the total number of new condos in Toronto in pre-construction, under construction, occupancy and sell-out phases will be about 100,000 units at the end of 2013.
Central 1 also predicts Ontario’s overall rental apartment vacancy will hold steady at 2.6% through 2014, before declining to less than 2% in 2016.
The forecast says the average price of residential home sales is forecast to rise at four to 5% annually through 2016 in the Toronto, Northeast and Stratford-Bruce regions.
Average price increases of two to 3% annually are forecast in the Northwest, London, Windsor-Sarnia, Hamilton-Niagara and Muskoka-Kawarthas regions.
Average price growth of around 1% annually is forecast for the Kitchener-Waterloo, Ottawa and Kingston-Pembroke regions.
Central 1 expects sales growth through 2016 will be concentrated in Toronto, although sales are also forecast to rise in the Northeast, Windsor-Sarnia and Stratford-Bruce regions.
Sales will remain near 2013 levels in the Ottawa, London and the Northwest regions. Sales are forecast to slow in the Kingston-Pembroke, Hamilton-Niagara, Muskoka-Kawarthas and Kitchener-Waterloo regions.
Other housing data released Thursday, suggested the market was slowing, but not in an alarming way.
Teranet-National Bank Composite House Price Index showed Canadian home prices edged down in November, reversing the gains seen the month before and suggesting a softer than usual market.
The index, which measures price changes for repeat sales of single-family homes, showed national prices slipped 0.1% last month from October. The average November monthly gain over 15 years of data has been 0.1%, Teranet said.
“This year’s retreat does not signal a buoying market,” the report said.
Prices were up 3.4% from a year ago, an acceleration from October’s 3.1% price gain, due to a greater drop in prices in November 2012.
Statistics Canada says its new housing price index rose 0.1% in October, after being flat in September.
The agency says Hamilton was the top contributor to the national increase, with prices rising 0.6% in October.
Builders there cited market conditions and higher list prices for new phases of development as the reasons for the price increase.
The largest monthly price increase in October occurred in Windsor, where prices were up 0.7%.
Builders in Windsor said rising material costs, higher land development costs and market conditions contributed to the gain.
Prices declined in Charlottetown, Vancouver and Victoria and were unchanged in seven of the 21 metropolitan areas surveyed.
Reuters @ http://business.financialpost.com/