March 05, 2021, by Sean MacKay
In a research note published, Central 1 Credit Union Economist Edgard Navarrete wrote that Toronto’s average selling price remained above $1 million for the second month in a row in February. With interest rates expected to stay low for the foreseeable future and new listings struggling to keep pace with buyer demand, Navarrete believes the market is on course to heat up even further.
“Unaffordability concerns will be stoked significantly in 2021, perhaps leading to another year of significant exodus out of the city due to affordability erosion,” he wrote.
Although it appears likely that Toronto will gradually reopen in the coming months as the vaccination campaign picks up steam, remote work may be here to stay for many employers in the region. Navarrete writes that those not tethered to a workplace in the GTA could very well leave the region entirely for a more affordable community.
All suburban areas in the Toronto region tracked by the Toronto Regional Real Estate Association (TRREB) have been posting double-digit annual price gains in recent months, so moving outside the region could make sense for buyers with lower budgets.
Of the 30 suburban cities and towns tracked by TRREB, only eight had average detached home prices below $1 million in February. During the same month last year, there were 20 suburbs with average detached home prices below $1 million.
What does this mean?
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