Here's how much house prices could climb in Mississauga in 2020
If you plan on purchasing a home in 2020, you already know that house prices are expected to climb five per cent in Mississauga.
While the five per cent projection came from real estate brokerage RE/MAX, another brokerage is also forecasting a rise in home prices in the new year.
According to the Royal LePage Market Survey Forecast, Canadian home prices are expected to see "healthy appreciation" by the end of 2020. The forecast says the increase will be driven by low single-digit appreciation in both the condominium and detached home segments.
Royal Lepage says the aggregate price of a home in Canada is forecast to rise 3.2 per cent year-over-year to $669,800 in 2020, with the median price of a condominium and two-storey detached house projected to increase 3.6 per cent and 3.1 per cent to $506,100 and $785,400, respectively.
So, what's expected to happen in the GTA?
The forecast says the market is tight, as supply is low and demand is high—an issue compounded by the fact that more and more people are moving into the area.
The aggregate price of a home in the GTA is forecast to increase by 4.75 per cent year-over-year in 2020, rising to $883,700. The median price of a condominium is expected to increase 6.0 per cent year-over-year to $600,000 and the median price for a two-storey detached home is forecast to rise 4.5 per cent year-over-year to $1,027,200 by the end of next year.
“Inventory is critically low and it is possible that we could see a return to accelerating high price appreciation in the near term without new supply becoming available,” said Kevin Somers, Chief Operating Officer, Royal LePage Real Estate Services Limited.
“Areas such as Richmond Hill and Markham, which were among the hardest hit by the recent market correction, have already shown signs of a recovery while areas closer to the city centre are showing significant momentum heading into 2020.”
Somers said that while many young families are growing out of their condominiums, moving into a larger property is not an option that many can afford.
The forecast says the federal government's First-Time Home Buyer Incentive may benefit single first-time condominium buyers, especially in the greater region, but it is unlikely to benefit buyers looking for a property suited for a family unless modifications proposed in the Liberal election platform increasing the qualifying purchase threshold to $800,000 actually take effect.
As for what will drive healthy growth in the market across the country, the forecast says demand for housing has increased as people have adjusted to the mortgage stress test.
The forecast says another significant driver in demand is Canada’s healthy immigration rate.
According to the Royal LePage Newcomer Survey released in October 2019, newcomers to Canada are expected to purchase one in every five homes on the market over the next five years. Newcomers have high consumer confidence in Canadian real estate (86 per cent) and arrive with savings to put towards the purchase of a home (75 per cent).
Interestingly enough, the forecast says housing could continue to rise even in the event of an economic downturn, as interest rates could drop if Canada continues to shed jobs in 2020.
“Our 2020 national forecast is based on a continuation of healthy economic conditions,” said Phil Soper, president and CEO, Royal LePage.
“Paradoxically, a slowdown in economic growth could cause us to revise the outlook upward. While one month does not a trend make, November’s surprisingly weak employment numbers may be the trigger that causes the Bank of Canada to join the U.S. Federal Reserve in lowering interest rates.”
“Falling rates normally encourage new housing demand. This would mean further upward price pressure in regions where employment remains healthy, which is most of the country. That window to lower or flat home prices is closing or has closed for most Canadians.”
Do you plan on buying a house in 2020?
- Here’s how much Mississauga house prices increased in 2019
- Here’s How Much Home Prices are Expected to Climb in Mississauga
- Here’s how much house prices are expected to climb in Mississauga next year
- Here’s How Much House Prices Are Expected to Climb Next Year
- GTA Housing Market Was “Canada’s Least Healthy”