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  • Your Weekly 411: GTA Home Prices Decline 5%| 82% of Toronto's Homes Are Selling Under Asking | $2B Investment in Canadian Housing

Your Weekly 411: GTA Home Prices Decline 5%| 82% of Toronto's Homes Are Selling Under Asking | $2B Investment in Canadian Housing

$2B Investment in Canadian Housing

Author

Urban 411
June 22, 2024

The Weekly 411:

Today we're covering

📉 GTA Home Prices Decline Nearly 5% in July

🤑 82% of Toronto's Homes Are Selling at a Discount

💰 US Company Invests $2B In Canadian Housing Projects

🏗️ Rental Housing Construction Surges in Canada

🏘 Top 5 Canadian Cities w/ Biggest Home Price Drops

🤔 WTF of The Week

Read Time: 4 minutes

📉 GTA Home Prices Decline Nearly 5% in July

  • GTA home sales in July 2024 rose by 3.3% compared to July 2023.

  • New listings increased by 18.5% year-over-year, providing more choices for buyers.

  • The average home price in the Greater Toronto Area (GTA) declined by nearly 5% in July to $1.106 million.

  • Prices dropped for all property types, with townhomes and semi-detached seeing the greatest declines at 3.4% and 3.3% respectively.

Why This Matters: The number of homes for sale is the highest since the financial crisis in 2008-09. This means buyers have more options and can negotiate better prices. However, as more homes are sold, the market will become more competitive, and prices will likely start rising again.

​(source)​

🤑 82% of Toronto's Homes Are Selling at a Discount

  • Only 14% of neighborhoods saw overbidding in July 2024, down from 27% in June

  • 4% of neighborhoods had homes selling at asking price, while 82% saw underbidding

  • Only 4% of neighborhoods had homes selling at asking price, while 82% saw underbidding

Why this Matters: The Greater Toronto Area real estate market is experiencing an oversupply of homes on the market. Overbidding has dropped to its lowest level since January, at just 4% of neighborhoods. This contrasts sharply with July 2023, when over one-third (38%) of neighborhoods were in overbidding territory. 

💰 US Company Invests $2B In Canadian Housing Projects

  • Due to Canada's housing shortage, Hines sees apartment building developments as a top investment

  • The firm targets major cities like Toronto, Vancouver, Calgary, and Montreal for land acquisition.

  • Hines prefers to develop large rental-only towers but will consider projects as small as 4-6 storeys.

Why This Matters: It signals a significant investment opportunity in the Canadian housing market. The emphasis on purpose-built rentals aligns with government initiatives and changing housing preferences, suggesting a strong future for this segment. Along with Blackstone's recent $3.5B investment in Tricon Residential, these moves underscore the growing attractiveness of the Canadian rental market to major international investors.
​(source)​

🏗️ Rental Housing Construction Surges in Canada

  • Overall housing starts reached 240,000 units in 2023, a 36-year high.

  • Rental construction is driving most of the homebuilding activity, while single-family home construction has decreased.

  • The rental vacancy rate hit an all-time low of 1.5% in 2023

  • Rent growth reached 8% in 2023, outpacing inflation (3.9%) and wage growth (2.8%).

🏘 Top 5 Canadian Cities w/ Biggest Home Price Drops

  1. Lloydminster, SK: 41.4% decline

  2. Fort McMurray, AB: 16.2% decline

  3. Swiftcurrent, SK: 8.8% decline

  4. Lloydminster, AB: 8.5% decline

  5. Cornwall, ON: 6.3% decline
    ​(source)​

🤔 WTF of The Week

Toronto's fees are exceptionally high, adding an unexpected financial burden on homebuyers and making the dream of homeownership significantly more expensive in Canada's largest city. This disparity raises questions about fairness and affordability in the real estate market across different regions.