Over the last 12 months, something unique has transpired in the Canadian real estate market. As the major urban centres such as Toronto experienced record sales and price growth, the trend seeped across the broader GTA real estate market into surrounding smaller communities. In North America’s fourth-largest city, every jurisdiction outside the downtown Toronto core has witnessed monumental gains that have either never been seen, or have not been replicated in many years.
The Oakville-Milton housing market is no exception to this development in the Ontario real estate market. Although the region enjoyed enormous growth before the coronavirus pandemic, thanks to its close proximity to Toronto, this market in southwestern Ontario is reporting double- and triple-digit growth. Looking at the numbers requires a double take because they are so immense.
But why? The same factors that are contributing to market growth nation-wide, are also fuelling momentum within the Oakville-Milton housing market: low supply and strong demand.
So, what happened in the Oakville-Milton housing market in April? Here is the data:
GTA Real Estate Trends: A Peek Inside the Oakville-Milton Housing Market
Home sales advanced by 210.47 per cent year-over-year in April, totalling 862 units, according to the Oakville, Milton and District Real Estate Board (OMDREB). The sales activity was impressive to kick off the second quarter of 2021, but home valuations were just as noteworthy.
The average price for a residential property in Oakville climbed at an annualized rate of 36.1 per cent to $1,994,612. The average sale price for both a townhome and a condominium jumped 37.2 per cent to $994,391. Milton enjoyed even more success: average home sale prices soared 63.9 per cent to $1,469,817 and average townhome and condominium valuations increased 25.7 per cent to $789,930.
But are these numbers too good to be true? Industry experts note that the figures are pushed up because of the temporary effects that the coronavirus pandemic had on the Ontario real estate market.
“The number of listings and home sales in Oakville, Milton, and Halton Hills continued to rise once again throughout the month of April, beating out March’s previous records. As expected, averages prices also followed the same trend,” said OMDREB President Lynn Hoffmann in a news release.
“Compared to last year, we’re continuing to see explosive growth in most areas, but we must be mindful of the impact the COVID-19 pandemic had on the market around this time in 2020. Many statistics being pushed out are going to seem almost absurd, with a prime example being home sales increasing in our jurisdiction by over 320% in April 2021 compared to April 2020. Seeing numbers like this may continue for a while, but we’ll have a correction to this kind of inflation eventually.”
Still, the Oakville-Milton housing market cannot escape the fact that supply remains a top issue across the greater GTA real estate market.
Will Market Conditions Ease in Oakville-Milton?
Although the Oakville and Milton real estate markets are still struggling with a supply shortage, there have been improvements and relief could be on the horizon.
New listings for single-family homes in Oakville climbed 176.2 per cent to 268 in April, while new listings for townhouses and condos soared 272.9 per cent to 179. Milton enjoyed similar numbers: new listings for single-family properties increased 178.6 per cent to 117, while new listings for townhouses and condos spiked 142.9 per cent to 102.
New construction activity is also picking up in Oakville and Milton. According to Canada Mortgage and Housing Corporation (CMHC), Oakville experienced 234 new housing starts in March and Milton saw 178 starts.
“The one thing that is still apparent – and not inflated – is the lack of inventory, which has yet again fallen since this time last year. It is incredibly clear that inventory must be addressed, and we need our government’s help in doing that,” Hoffman added.
Big City Feel in Oakville-Milton Housing Market
For homebuyers who might have left their urban areas in search of more square footage, the Oakville-Milton housing market is beginning to have a big-city feel when it comes to purchasing property. Bidding wars, buyers waiving home inspections, and low interest rates leading to higher valuations. These are the characteristics of a red-hot housing sector you would typically find in urban markets like Toronto, Vancouver, Ottawa or Montreal. But in small cities, suburbs and rural communities? This could be the new normal for the Canadian real estate market, at least for now,
Reports reveal that it would take 19 years for the country’s property bubble to endure a soft landing. This is not exactly the greatest of news on the affordability front, particularly when it comes to market accessibility for the young generation of first-time homebuyers.