Resales at all-time high as York Region house prices climb 13.5%

Yorkregion.com
May 20, 2016
By Lisa Queen

Here’s good news if you’re planning on putting your house up for sale any time soon.

The average price of a resale home in York Region increased by 13.5 per cent in 2015 to $777,927, Paul Bottomley, York Region’s manager of policy, research and planning in the economic development department, said during a presentation on the state of the region’s economy.

That has jumped from $491,883 for the average resale home only five years ago.

Meanwhile, the price is almost 70-per-cent higher than what the province deems is the maximum affordable homeownership threshold for the region.

That stood at $459,000 in 2015.

“There is an increasing gap between this affordable threshold and the average resale price, with the gap increasing considerably over the last few years,” Bottomley said.

If the price of new homes were included, which sat  at an average of $987,106 at the end of 2015, the gap between the affordable housing threshold and the cost of buying a home in York would be even higher.

The typical price of a resale home in the region is 25-per- cent higher than the Greater Toronto Area, where the average is $622,217.

The region continues to show strength in the residential resale market, recording the highest number of resales ever in 2015, at more than 19,100 sales, Bottomley said.

“All in all, going back over the last few years, the resale market continues to be very strong in York Region, which has reported above 16,000 resales annually since 2009.”

The average price of a resale single detached home in York in 2015 was $943,411, up 15 per cent over 2014.

For a semi-detached home, the average price last year was $606,779, up 13.8 per cent over the year before.

The average townhouse cost $575,427, up 12.2 per cent.

The skyrocketing prices can be attributed to a number of issues, including a lack of houses for sale compared to demand, resulting in more competition and aggressive offers, Bottomley said.

Housing prices have been driven up by a lack of “ground-level” housing such as detached, semi-detached and townhouse homes, Jason Mercer, director of market analysis with the Toronto Real Estate Board.

“We’re certainly experiencing sellers’ market conditions in York Region, along with all the other regions in the Greater Toronto Area,” he said.

“I would say the biggest story over the last year has been the short supply of listings. There aren’t a lot of homes out there for people and when that happens, you see price growth.”

Of course, all those inflated housing numbers may not be good news if you are purchasing elsewhere in the region where prices are also high or you are a first-time buyer trying to get your foot in the door of York’s hot housing market.

“Some people can’t even afford to get into the market. When you think about people in their 20s and 30s wanting to do starter homes, they’re never going to get there. Even if they do, they are going to be paying an incredible amount of money just to stay housed,” Mary Ann Proulx, executive director of York Region’s citizens for affordable housing based in Richmond Hill.

“The population that I work with are low-income and middle-income, people who generally are not in a position to be home owners and they are going to be renting. Well, the average one-bedroom apartment rents for $1,000 a month in York Region, and try and find that. We’re in a housing crisis. I don’t know what the solution is, but something’s got to give.”

Meanwhile, building permits were issued for 9,546 new houses in York last year, a 51-per-cent increase over 2014, Bottomley said.

The region has the second highest share of building activity in the GTHA at 22 per cent, second only to Toronto’s 36 per cent. Peel Region is at 19 per cent, Halton Region is at 9 per cent, Durham Region is at 8 per cent and Hamilton is at 6 per cent.

Across Canada, York is fifth in the number of residential building permits issued last year, behind Greater Vancouver, Toronto, Edmonton and Calgary.

York is seventh in Canada for industrial, commercial and institutional construction, with almost $927.5 billion worth of construction last year.

The 2015 total construction value in the region was almost $4 billion, the highest ever recorded.

Other highlights of Bottomley’s presentation included:

• The population of the Greater Toronto and Hamilton Area is estimated to be 7.2 million, up about 90,000 new residents in the last year.
• York’s population is almost 1.166 million or 16.2 per cent of the GTHA total, down from about 17 per cent in 2010.
• The region welcomed about 21,500 new residents last year, which is a growth rate of almost 2 per cent. Before the recession of 2008, the region was growing by more than 30,000 residents a year.
• By comparison, Toronto has 39.2 per cent of the GTHA’s population, while Durham Region has 9.2 per cent, Peel Region has 20 per cent, Halton Region has 7.8 per cent and Hamilton has 7.7 per cent.
• Markham grew by 8,000 residents last year, a 2.3-per-cent increase. In percentage terms, King grew the most at 3.8 per cent, which worked out to just less than 1,000 new residents. Aurora grew by 2.5 per cent, East Gwillimbury by 1.2 per cent, Georgina by 1.3 per cent, Richmond Hill and Vaughan each by 1.8 per cent and Whitchurch-Stouffville by 1.6 per cent. Newmarket had the smallest percentage population growth at 0.5 per cent.
• In terms of numbers of new residents, the majority of growth remains in Markham, Richmond Hill and Vaughan, which took in more than 17,000 of York’s 21,500 new residents.
• Since 2008, 91,000 new jobs have been created in the region, including more than 13,000 in 2015. That compares to 7,400 new jobs last year in Durham Region, 3,000 in Mississauga and 38,000 in Toronto.
• York’s unemployment rate dropped to 5.7 per cent last year, down from 6.2 in 2014.
• The United States is Canada’s and York Region’s largest trading partner. The region exports $4 billion worth of goods annually, with most of that going to the U.S.
• Almost 60 per cent of foreign direct investment in the region is from the U.S. and the majority of foreign-owned firms with a presence in the region are American.
• The U.S. economy is expected to remain resilient and is anticipated to report steady growth in the employment and housing markets, which will have a positive spinoff effect for York.
• The lower Canadian dollar will benefit the GTHA industrial market, including York Region’s, which will result in higher demand for export of goods to the U.S.

By the numbers

York’s population almost 1.16M or 16.2% of GTHA total, down from 17% in 2010.

GTHA population up by 90,000 in the past year.

York Region welcomed 21,500 new residents last year, growth of 2%.

York’s jobless rate dropped to 5.7%. This is down from 6.2% in 2014.

York seventh in Canada at $927.5B worth of industrial, commercial and institutional construction.

Region has 2nd highest share of building activity in GTHA at 22%.