"Move-over" buyers from Toronto and Vancouver turning to surrounding areas to find
a balance of affordability, square footage, and access to amenities
and infrastructure
TORONTO and KELOWNA, BC, April 25,
2017 /CNW/ - Significant price increases and high demand in
the Greater Toronto Area during
the first quarter of 2017 spurred growing numbers of buyers to
leave the downtown core. These buyers, known as
move-overi buyers, are looking for greater
affordability in markets across southern Ontario. In turn, they are driving price
appreciation in Mississauga,
Brampton, Durham, Barrie, Hamilton-Burlington, Windsor, and as far away as Kingston. The GTA saw the average residential
sale price rise by 29 per cent, up from $675,492 in the first quarter of 2016 to
$873,631 during the same period in
2017.
At the same time, housing demand has slowed in Greater Vancouver compared to Q1 of 2016, and
average residential sale price decreased 11 per cent
year-over-year, from $1,094,936 in
the first quarter of 2016 to $969,900
in 2017. The decline in average sale price is in part due to the
introduction of the foreign buyer tax last August, a relatively
severe winter and the natural stabilization of prices after the
market reached a high point in May
2016. Move-over buyers from Vancouver and buyers migrating from other
provinces continue to fuel activity in Fraser Valley, Kelowna, and in Victoria, particularly in the upper-end of the
market due to relative affordability in these regions.
"The move-over buyer activity we're seeing in the areas
surrounding Canada's two largest
urban centres is a direct response to price appreciation caused by
high demand in recent years," said Elton
Ash, Regional Executive Vice President, RE/MAX of
Western Canada. "Price and
location are the most important factors to buyers. If the price
isn't right, move-over buyers look to markets where they can find a
better balance of affordability and square footage, and still have
access to green spaces, transit options, and retail centres."
A recent RE/MAX survey conducted by Leger found that when making
buying decisions, over two-thirds of Canadians consider the
location of a home to be more important than the style or size of
the home. Respondents indicated that beyond price, a number of
other factors influence home purchases, including: access to green
space (77 per cent), proximity to work (66 per cent), proximity to
retail centres (65 per cent), and proximity to family and friends
(65 per cent). All of these ranked higher than the style of a
home.
In response to heightened activity seen across the GTA in recent
months, the Ontario provincial
government announced a 15 per cent Non-Resident Speculation Tax
(NRST), along with a number of other regulations in mid-April in an
effort to balance the need to stabilize the market while preventing
a harmful sharp correction. Similar to the foreign buyer tax
introduced in Vancouver last year,
the impact of this measure on market and buyer activity in the long
run is difficult to predict. This measure may impact consumer
confidence in the short-term as buyers hold out until they fully
understand how they are affected, causing overall market activity
to slow.
"Toronto and Vancouver are very different markets as
Vancouver's population and
geography are much smaller. At this point there is limited data on
how many foreign speculators are active in the GTA market, but it
is fair to assume that the new tax will impact the middle-class and
not just buyers in the upper-end of the market," said Christopher Alexander, Regional Director, RE/MAX
INTEGRA Ontario-Atlantic Canada Region. "In the short-term,
potential sales may stall as buyers wait to see the impact of the
changes, which in turn could create a ripple effect throughout the
Golden Horseshoe, however, it will be interesting to see how this
new legislation will affect the demand for housing in the
market."
In Western Canada, particularly
in Alberta, slowly recovering oil
prices, low interest rates, and US approval of the Keystone XL
pipeline project have renewed buyer optimism, particularly among
move-up buyers and millennial, first-time buyers who are typically
looking to buy condominiums. The average residential sale price
increased three per cent year-over-year in Calgary to $482,065, up from $467,780 during the first quarter in 2016. A wide
variety of inventory across the market provides good opportunities
for buyers in Edmonton, resulting
in a 12 per cent increase in activity and stable year-over-year
prices to start 2017.
Charlottetown and Halifax experienced increased demand from
foreign buyers in the first quarter in addition to sustained demand
from buyers moving back to Atlantic
Canada from other parts of the country to purchase more
affordable housing options than what is available in Canada's larger urban hubs.
New residential and commercial development projects in markets
across the country are expected to fuel demand in these regions.
These cities include Calgary,
Edmonton, Kelowna, Victoria, and Regina in the West and
Windsor, London-St.
Thomas, Hamilton-Burlington, Mississauga, Barrie, Durham, Brampton, Ottawa, Saint
John, and Halifax in
Central and Eastern Canada.
For the full 2017 RE/MAX Spring Market Trends report with
detailed regional summaries and buyer demographics, click here.
Data Table
Market
|
Average
Residential Sale Price
|
YOY%
|
|
2016
|
2017
|
2017/2016
|
Victoria
|
$544,756
|
$612,584
|
12%
|
Greater
Vancouver
|
$1,094,936
|
$969,900
|
-11%
|
Fraser
Valley
|
$645,472
|
$671,796
|
4%
|
Kelowna
|
$447,416
|
$504,643
|
13%
|
Edmonton
|
$363,728
|
$364,473
|
0%
|
Calgary
|
$467,780
|
$482,065
|
3%
|
Saskatoon
|
$344,319
|
$340,300
|
-1%
|
Regina
|
$311,953
|
$306,036
|
-2%
|
Winnipeg
|
$273,312
|
$285,645
|
5%
|
Windsor-Essex
|
$211,211
|
$246,775
|
17%
|
London-St.
Thomas
|
$271,920
|
$307,189
|
13%
|
Greater
Sudbury
|
$247,659
|
$266,855
|
8%
|
Kitchener-Waterloo
|
$364,966
|
$468,877
|
29%
|
Hamilton-Burlington
|
$467,931
|
$575,004
|
23%
|
Barrie
|
$379,330
|
$525,830
|
39%
|
Greater Toronto
Area
|
$675,492
|
$873,631
|
29%
|
GTA:
Oakville
|
$997,353
|
$1,313,477
|
32%
|
GTA:
Mississauga
|
$576,134
|
$753,788
|
31%
|
GTA:
Brampton
|
$542,388
|
$731,793
|
35%
|
GTA:
Durham
|
$481,153
|
$668,827
|
39%
|
Kingston
|
$290,592
|
$323,343
|
11%
|
Ottawa
|
$361,503
|
$381,524
|
6%
|
Saint John
|
$163,778
|
$183,486
|
12%
|
Halifax
|
$274,937
|
$271,165
|
-1%
|
Charlottetown
|
$171,547
|
$189,900
|
11%
|
Greater St. John's
Area
|
$322,677
|
$304,812
|
-6%
|
Key Findings from 2017 RE/MAX Spring Market Trends Omnibus
Survey
1. When purchasing a home over two thirds of
Canadians consider the location of a home to be more important than
the style or size of a home
- British Columbia = 69 per
cent
- Alberta = 63 per cent
- Saskatchewan and Manitoba = 69 per cent
- Ontario = 68 per cent
- Quebec = 68 per cent
- Atlantic Canada = 69 per
cent
2. Nearly half (46%) of Canadians currently
feel like they can purchase the type of home that suits their
families' needs
- British Columbia = 40 per
cent
- Alberta = 55 per cent
- Saskatchewan and Manitoba = 54 per cent
- Ontario = 46 per cent
- Quebec = 45 per cent
- Atlantic Canada = 43 per
cent
3. Beyond the price of a home, more Canadians rated
having access to green space as an important factor when looking to
purchase a home than any other consideration. For millennials
specifically, being close to the workplace was the most frequently
cited reason for considering a neighbourhood.
- Prices of homes in the neighbourhood (89%)
- Access to green spaces and parks (77%)
- Proximity to work (66%)
- Proximity to retail centres (65%)
- Proximity to family and friends (65%)
- Style of homes in the neighbourhood (64%)
- Proximity to public transit (56%)
- Proximity to preferred schools (43%)
- Proximity to cultural and community centres (42%)
Rank of importance to Canadian millennials (Aged 18-34)
- Prices of homes in the neighbourhood (85%)
- Proximity to work (84%)
- Access to green space and parks (76%)
- Proximity to family and friends (71%)
- Proximity to preferred schools (65%)
- Style of homes in the neighbourhood (65%)
- Proximity to retail centres (61%)
- Proximity to public transit (61%)
- Proximity to cultural and community centres (46%)
4. Canadians rate the following resources as
being helpful to them when buying a home:
- Access to a real estate agent = 79 per cent
- Information and recommendations from friends and family
(regarding the neighbourhood of your choice, home value, home
features and amenities) = 80 per cent
- Online listings = 90 per cent
- Easily accessible information about homes in the neighbourhood
(types of homes, age of homes, average home prices) that you are
considering buying in = 90 per cent
- Easily accessible community information (average age, education
levels, average income etc.) for the neighbourhood that you are
considering buying a home in = 70 per cent
- Easily accessible information about schools in the
neighbourhood that you are considering buying a home in = 56 per
cent
Canadian millennials rate the following resources as being
helpful to them when buying a home:
- Access to a real estate agent = 76 per cent
- Information and recommendations from friends and family
(regarding the neighbourhood of your choice, home value, home
features and amenities) = 81 per cent
- Online listings = 88 per cent
- Easily accessible information about homes in the neighbourhood
(types of homes, age of homes, average home prices) that you are
considering buying in = 87 per cent
- Easily accessible community information (average age, education
levels, average income etc.) for the neighbourhood that you are
considering buying a home in = 68 per cent
- Easily accessible information about schools in the
neighbourhood that you are considering buying a home in = 72 per
cent
About the RE/MAX Network:
RE/MAX was founded in 1973 by Dave and
Gail Liniger, with an innovative, entrepreneurial culture
affording its agents and franchisees the flexibility to operate
their businesses with great independence. Over 110,000 agents
provide RE/MAX a global reach of more than 100 countries and
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Associates and over 750 independently-owned and operated offices
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please visit www.remax.ca.
About RE/MAX INTEGRA and RE/MAX INTEGRA,
Ontario-Atlantic Canada
RE/MAX INTEGRA, founded in 1980, is a privately held company by
Canadian entrepreneurs. With regional headquarters in Toronto, Boston, Minneapolis, Indianapolis, Zug, and Vienna, RE/MAX INTEGRA represents nearly a
third of all RE/MAX Sales Associates worldwide. The company was
founded on the premise of providing outstanding service and support
both at the regional level and to the end consumer. 6 The
Ontario-Atlantic Canada region has surpassed 10,000
quality Associates; The US regions — New England and the Midwest
(including the following states: Minnesota, Wisconsin and Indiana) – account for more than 6,500
Associates with over 2,600 and 3,800 Associates respectively; and
the European region leads with more than 16,000 Associates. For
more information about RE/MAX INTEGRA, visit
www.remaxintegra.com
About Leger
Leger is the largest Canadian-owned full-service market research
firm. A survey of 1570 Canadians was completed online between
March 27-30, 2017 using Leger's
online panel, LegerWeb. Leger's online panel has more than
475,000 members nationally – with between 10,000 and 20,000 new
members added each month, and has a retention rate of 90%. A
probability sample of the same size would yield a margin of error
of +/- 2.5%, 19 times out of 20.
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___________________________
|
i
|
RE/MAX defines
move-over buyers as home buyers leaving the market in which they
currently live to find a better balance of affordability, square
footage, and access to amenities and infrastructure in a different
market.
|
SOURCE RE/MAX Ontario-Atlantic
Canada