Canada’s three largest metro areas reported another hot month for housing in October, with sales up by double digits in the Toronto, Montreal and Vancouver areas, despite warnings from the experts that the market is bound to cool off in the coming months.
Home sales in Greater Toronto were up by 25.1 per cent compared to the same month a year earlier, and the average price of a detached home hit a new milestone of $1.2 million. The condo market was somewhat softer, with prices up 0.7 per cent, to $622,000.
That happened despite the Ontario Real Estate Association’s ban on in-person open houses in COVID-19 hot spots such as Toronto, Peel Region and Ottawa, which was instituted mid-October.
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Jason Mercer, the Toronto Regional Real Estate Board’s chief market analyst, says the economic recovery since spring combined with low borrowing costs have made the housing market attractive to many.
“Expect record or near-record home sales for the remainder of 2020,” he wrote in a report Wednesday.
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Vancouver’s housing market experienced its second-best October ever, with 29 per cent more sales closing than a year ago. The benchmark price for all house types was $1.045 million, up 6 per cent in a year, according to the region’s real estate board.
Home sales in Montreal had their best October ever, jumping 37 per cent from a year ago, and the median price of a detached home jumped 21 per cent. Condo prices are up 16 per cent.
“The second wave of COVID-19 has so far let no air out of the market’s tires,” National Bank economists Marc Pinsonneault and Alexandra Ducharme wrote on Tuesday in a report on the Montreal market.
“On the contrary, despite the spring dip triggered by the first wave, sales so far in 2020 are on track for a third straight record year.”
High demand ‘will continue’
There are some signs of softening in parts of the housing market, principally urban condos, which have seen a spike in new listings that has outgrownsince the spring that has outgrown demand, and that could mean a softer condo market ahead.
But Mercer expects the market to remain healthy in the long term, whatever the short-term pressures.
“Looking beyond COVID-19, it is clear that the high demand for housing will continue. The federal government has set immigration targets above 400,000 people for each of the next three years. The GTA will undoubtedly continue to benefit from this population growth. All of these people will need a place to live, whether in the ownership or rental markets.”