Sales of high-end houses helped to keep the average price of a detached Toronto house at well over $1 million in June, the Toronto Real Estate Board says.
In the Greater Toronto Area (GTA), the average selling price for all homes last month was $639,184. That's up 12.3 per cent from the same month a year ago, the board said Tuesday.
The real estate board said the most expensive homes are driving that double-digit increase in average prices.
Using another method of home price calculation — the MLS Home Price Index composite benchmark — the typical selling price was up by 8.9 per cent.
Sales of houses, townhomes and condos in the GTA reached 11,992 in June, up more than 18 per cent from 10,132 in June 2014 — a record for the month.
In Toronto, the average selling price of a detached house last month hit $1,051,912, an increase of 14.2 per cent over last year.
House prices in Toronto and Vancouver have been rising far faster than inflation in the last few years.
Next week, the Bank of Canada will decide whether to leave its trendsetting key interest rate as is (at 0.75 per cent), or change it. Financial markets are putting the odds of a quarter of a percentage point rate cut coming out of that meeting at 50 per cent.
Financial Analysis of Real Estate Market
The big bet against the Canadian housing market, especially in the Greater Toronto Area, has still failed to take hold. Yet this is the primary reason why U.S. hedge funds have reportedly been adding to their short positions on Canadian bank stocks.
Despite being seemingly expensive, and propped up to some extent by foreign buying, there is very likely going to be another leg up in the GTA housing market fuelled by Canadian inter-provincial migration inflows.
Ontario has rarely looked this good — at least on a relative basis. And escalating in-migration inflows coupled with tight land supply and ultra-low interest rates means that this hot real estate market is about to get a lot hotter in the next year or two.
Ontario benefits from the impact that interest rates, currency and in-migration flows will have on the local housing market.
Canada’s largest alternative mortgage provider moved swiftly to reassure investors Thursday that loans made to borrowers based on falsified income documents were not at risk.
Home Capital Group Inc. also said most of the mortgages in question were insured and that mortgage insurers, such as CMCH, would cover them if they went into default, despite being issued on a false basis.
The Toronto-based company disclosed late Wednesday that its operating arm, Home Trust, had cut ties with 45 mortgage brokers after discovering some mortgages had been issued based on falsified income claims.
Home Capital’s clients include the self-employed, recent immigrants and other groups that have trouble qualifying for mortgages at major banks.
Home Capital said it was following standard industry practice when it accepted employment letters as sufficient evidence of borrower’s income.
