Mississauga House Prices Jumping Faster Than House Prices in Toronto
While it’s still cheaper to live in Mississauga than it is in Toronto—according to the Toronto Real Estate Board (TREB), a detached house in the 905 costs about $883,027, while a similar home in Toronto will run buyers about $1,174,134—a recent report suggest house prices are rising more rapidly in Mississauga than they are in Canada’s biggest city.
According to a recent Point2Homes report, which explores home price changes in the last five years in North America’s largest cities, Canada dominates the ranking of the most staggering home price jumps, with six spots in the top 10.
According to the report, Toronto ranks ninth among the largest North American cities with the most dramatic home price jumps, due to a 59 per cent hike over the last five years.
But it looks like prices are stabilizing in Toronto and climbing in nearby satellite cities.
Point2Homes says Toronto is outranked by Mississauga and Hamilton (with a significant 66 per cent increase), and Brampton (67 per cent).
The report says Toronto’s 68 per cent jump in home prices translates into a $312,100 net increase, the fifth highest in North America, pointing out that this amount alone could easily get you another house in many Canadian cities.
Mississauga comes in sixth, right after Toronto, with a $290,400 net gain. Brampton follows suit, in ninth place, with $247,800 added to home price tags in the last five years.
To give a little more perspective, since 2013, average home prices in Mississauga grew from a more modest $439,400 to $729,800. In Brampton, they grew from $371,700 to $619,500.
You can see a graphic,courtesy of Point2Homes, below:
As for what’s driving home prices, the factors involved are varied and complex.
While low housing inventory is a persistent problem in Toronto and the GTA, the report also says growing interest in urban living might continue to fuel future home price growth in some of North America’s biggest cities.
“Compared to just five years ago, 40 cities in the US, 31 in Mexico, and 10 in Canada have seen significant home price hikes, putting considerable strain on the average homebuyer,” the report reads.
“With more and more people opting for a connected, urban lifestyle, and with the younger generation’s desire to reduce commute time, demand for urban housing is skyrocketing.”
While the price jumps might be discouraging for prospective buyers in Mississauga, residents are not alone. Point2Homes say 18 of the 83 largest North American real estate markets saw home prices jump over 50 per cent in just five years. Of the 18 markets with the most explosive growth, 11 are in the US, six in Canada, and one in Mexico.
Only two cities witnessed a drop in home price compared to five years ago, and those cities are Calgary and Edmonton.
San Francisco boasts the highest net increase of all the cities in the study ($550,000), followed by two Canadian cities: Vancouver ($417,913) and Surrey ($395, 287).
The bad news is that, as most residents know, wages are not keeping pace with the growth in home values. Although incomes in Canada, the US and Mexico have been slowly but steadily going up since 2013, they’re not helping residents enter big city markets.
As a result, housing affordability is becoming increasingly problematic in many cities across North America. While the traditional rule of thumb - that a homebuyer should afford a home if its value is three times or less the annual household income - still holds in some markets, others are far more expensive than that.
In Mississauga, it’s hard to see how affordability can improve substantially for most residents.
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- How Much Home Does $300K Get You in Mississauga Compared to Other Cities?
- Mississauga House Price Increase Spreading Beyond the GTA
- Here’s How Much Mississauga Home Prices Have Risen in 5 Years