TREB’s Struggling Detached Market

In the run up to the massive price gains in spring of 2017, housing markets across the Greater Toronto Area could do no wrong. Since then, especially for the detached housing market, price gains have been anything but a certainty. The last 18 months have been tough across the GTA, with debate turning to how the different regions have held up in comparison to the others. This post will examine the detached markets for the seven regions tracked by TREB to see which has fared the best over the past five years and to see how regions have managed since prices peaked.

Regardless of region, since benchmark prices for detached houses peaked in May of 2017 every region in TREB is down (thus why we can say prices peaked last May). This is not to say that prices have not been rebounding since their initial fall, but it is noteworthy that not one single region in the GTA has completely made up its losses. The chart below shows detached prices from October 2013 to October 2018, with the middle point representing the May 2017 peak.

Region comparisonSource: TREB, Six Housing Sense

From the chart we can see that the largest drop was in the York region. At the peak, York region was the most expensive in the GTA just surpassing Toronto. York was an area that was associated with a higher proportion of investment purchases during the price surge, which has been the justification for the steeper drop since prices started to ease. Toronto and Durham have been the next hardest hit, with each falling 10% over the last 18 months. Whereas Halton and Simcoe have performed the best since last May, as both regions have only lost 3% from their major gains.

Region % Gain from Oct 2013 to Peak % Price Drop since May 2017
Toronto 74% -10%
Halton 58% -3%
Peel 78% -7%
York 91% -22%
Durham 86% -10%
Dufferin 80% -4%
Simcoe 88% -3%
TREB 80% -13%

Source: TREB

The price drop since the spring of 2017 is only truly valuable for those individuals who purchased at that time. For many others, how their market has performed over a longer period is more important. While York has lost the most since then, to be able to put that into perspective it is important to see how all regions have performed over the last five years.

Region October 2013 Price October 2018 Price % Change
Toronto $705,800 $1,109,300 57%
Halton $650,200 $970,800 54%
Peel $605,200 $932,800 66%
York $514,500 $853,400 49%
Durham $363,000 $603,400 66%
Dufferin $342,500 $595,900 74%
Simcoe $300,600 $549,300 83%
TREB $583,100 $914,500 57%

Source: TREB

The information shows that the price losses over the last 18 months have put the York region into a position where they are underperforming all other GTA communities. The strongest region has actually been Simcoe with a price gain of 83%, while Toronto and TREB overall are up 57% over the past five years. Though there is some variation between the regions, the five largest regions in TREB have all performed with relative consistency. Meaning that any housing purchase made in the GTA pre-October 2013 has paid off well (hopefully it has provided some memories too).

As the detached housing market continues its recent path of stagnant growth it will be interesting to see if these numbers start to fluctuate at all, or if all regions continue to move predominately in parallel. With reports out of Barrie of falling housing prices, we will also see whether or not the Simcoe region can remain the long term pace setter in the months ahead.

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