The Toronto housing market has been on a rollercoaster ride over the past few years. Despite the government’s best efforts to keep the market cool, things really heated up in the second half of 2019. Does 2020 hold the same fate? Take a look at what the experts predict this year will have in store for the housing and rental market in the GTA.
Overall, things will be on an upswing
According to the RE/MAX 2020 Housing Market Outlook Report, the ups and downs that the market has experienced over the past few years, specifically in 2019, will even out on an upward swing. Experts expect to see a 3.7 per cent increase in the average sale price on residential units in Canada. Certain regions in Southern Ontario are expected to see even higher than average gains, such as 12.9 per cent in Niagara, 10.7 per cent in London and 11.7 per cent in Ottawa.
The rental market will get more competitive
Some of the top real estate brokers and agents in the Toronto real estate game agree that the rental market in the GTA will continue to get more competitive in 2020. Using a property management firm like Royal York Property Management to ensure that the tenants in your units are top tier is more important than ever. Professionally managed properties become all the more attractive to high quality tenants looking to find vacancies in a tight market.
Mississauga will continue to outpace Toronto in rental increase race
Mississauga will see a huge influx of renters in 2020 as Torontonians look for suites with larger living spaces outside of the downtown core without losing access to the city. Experts forecast an 8 per cent increase in the average rental cost in Mississauga, which comes in higher than the 7 per cent increase predicted for Toronto, 5 per cent in Montreal and 3 per cent in Vancouver. There are plans for up to 50 new condominium projects expected to be built in the next 10 years in Mississauga alone, some of which are already highly anticipated. With transit options improving in the suburbs, more young people may be willing to leave Toronto for lower rental costs.
Young people will continue to rent as home prices continue to rise
2020 will probably not see many more millennials (those currently between the ages of about 25 and 34) purchasing homes than we have seen in previous years. In fact, a new study put forward by UBC’s School of Population and Public Health, written by Sutton Eaves and Dr. Paul Kershaw, states that in order to afford an 80 per cent mortgage on a standard Canadian home, the average millennial would need to earn double their current salary. With those numbers, millennials will continue to make up a large portion of renters in the GTA, especially as home and condominium prices are only expected to climb higher in 2020.
The price of real estate in Toronto will grow from low supply
A survey looking at newcomers to Canada released by Royal LePage in October of 2019 shows that newcomers to the country are projected to purchase 1 in every 5 homes and condos on the market in the next 5 years. In 2018, immigration was responsible for 80.5 per cent of Canada’s population growth, and most newcomers arrive with savings to put toward purchasing a home. So, what does this mean for the real estate market in the GTA? The demand for housing will become even greater with even more people vying for properties, making Toronto a seller’s market.
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