Since the early days of the coronavirus pandemic, all corners of the GTA real estate markets have benefited from households leaving Toronto’s downtown core, in favour of greener, cheaper pastures within a short drive to North America’s fourth-largest city. The York Region real estate market, from Markham to Richmond Hill to Vaughan, has seen prospective and first-time homebuyers flocking to destinations like these, just outside the urban core. This has prompted plenty of new trends in the region over the last two years. Will this lead to even more price acceleration?
Whatever the case may be, York Region kicked into high gear in 2020, sizzled in 2021, and could maintain its strength in 2022.
GTA Real Estate: A Look at the Booming York Region Housing Market
What does booming York Region look like these days? Here are the four specific factors contributing to the rise of this GTA real estate market.
Shrinking Supply, Surging Demand
Inventory levels have been at or near historic lows throughout the GTA housing market over the last couple of years. The numbers suggest that new housing construction is not keeping up with demand, which could maintain this imbalance: low supply and strong demand, leaving prices moving on an upward trajectory.
“Tight market conditions prevailed throughout the GTA and broader Greater Golden Horseshoe in 2021, with a lack of inventory noted across all home types. The result was intense competition between buyers, pushing selling prices up by double digits year-over-year. Looking forward, the only sustainable way to moderate price growth will be to bring on more supply. History has shown that demand-side policies, such as additional taxation on principal residences, foreign buyers, and small-scale investors, have not been sustainable long-term solutions to housing affordability or supply constraints,” said Toronto Region Real Estate Board (TRREB) Chief Market Analyst Jason Mercer in a recent report highlighting December market statistics.
Buyers Moving to Smaller Areas
Several months after the first wave of the coronavirus pandemic, a common term passed around in the business media was “urban exodus.” Many news outlets discussed that a growing number of households were fleeing the big cities to plant new roots in suburbs, small towns and rural communities. While a place like Markham is not situated in the middle of nowhere, the city does strike the right balance between living in the downtown core and enjoying small-town living. York Region has certainly benefited from the trend of families ditching shoeboxes in Toronto for a spacious residence in Richmond Hill.
York Vacation Properties Are Buzzing
When you think of York Region, you do not necessarily consider it a vacation hotspot in Ontario. However, there has been a lot of buzz outside of Richmond Hill in Wilcox Lake, which has attracted many people to purchase recreational and vacation properties. As well, throughout the pandemic, where more people are working from home and can enjoy the benefits of telecommuting, families are trying to live and work in nature; Wilcox Lake offers this highly coveted balance.
Will Vacant Home Taxes Come to York Region?
In recent months, many policymakers have come together proposing a myriad of tools to help cool down the housing market. York Region is no different. Officials in the regional municipality are mulling over a tax on vacant homes and speculative activities. The idea is to spur more housing units and to reduce prices amid the supply and demand chaos unfolding throughout York and the rest of the Ontario real estate market.
But critics contend that taxation is not the solution. Instead, many industry observers concur that facilitating more supply is the answer to today’s problems in the real estate market.
“Unless governments work together to cut red tape, streamline the approval processes, and incentivize mid-density housing, ongoing housing affordability challenges will escalate,” TRREB president Kevin Crigger noted in a statement.
Be Prepared in This Housing Market
Ultimately, no matter what transpires over the coming months, it would be a prudent to be prepared for rising interest rates and tightening mortgage lending standards. Whether the market sustains the boom or initiates its easing pattern, homebuyers must be ready for whatever happens. If you plan on buying a home, be sure you have saved an adequate down payment, get a mortgage pre-approval and work with a professional real estate agent, to help guide you through the process.