Mississauga housing market to favour sellers in 2021, prices expected to rise 4%
The Mississauga housing market is in store for another seller’s market in 2021, thanks to continuing challenges in housing supply and rising prices. Low inventory has been a common trend across many Ontario housing markets, putting upward pressure on prices. Indeed, Mississauga residential sale prices rose to $880,374 in 2020 (Jan. 1-Oct. 31) compared to $760,345 in 2019 (Jan. 1-Dec. 31). With supply levels expected to be a top concern in 2021, the RE/MAX outlook for Mississauga real estate is an increase of 4% in average priceto approximately $915,588.
Housing inventory currently sits at 1.5 months, and days on market are expected to hold steady in 2020.
Since the start of COVID-19, there has been a shift from high-rise spaces of smaller size to larger spaces with backyards. This has been a common trend across many Canadian housing markets as well as regions abroad, as homebuyers seek more square footage and green space outside of urban areas in the wake of the pandemic.
This new buyer sentiment is anticipated to continue in Mississauga in 2021, but it is thought that once COVID-19 is more under control, the region will see a return to its pre-COVID environment.
In 2021, move-up buyers are expected to drive the market, most of them looking for two-story detached homes. First-time homebuyers in the region are typically young couples looking for condominiums priced between $450,000 and $550,000. Meanwhile, demand for luxury properties has increased since the start of COVID-19, and is driven by move-up buyers. Recently the reduction of supply has put significant pressure on prices, with the average home price of a luxury property starting at $2,300,000.
The top three neighbourhoods in Mississauga, based on 2020 sales, are City Centre, Hurontario and Churchill Meadows. Next year, these areas will continue to be in high demand based on their relative affordability, access to public transit, and access to amenities.
Canadian Housing Market in 2021
Canadians are on the move. RE/MAX isn’t calling this an “exodus,” but the re-location trend across the Canadian housing market is real, and it’s just one focus of the RE/MAX 2021 Housing Market Outlook Report. RE/MAX Canada anticipates healthy housing price growth at the national level, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing and widespread housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.
Due to these factors, the 2021 RE/MAX 2021 outlook for average residential prices is an estimate of +4% to +6% nation-wide. Here’s the regional break-down:
35% of RE/MAX brokers indicate that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021
45% of RE/MAX brokers indicate that move-up buyers will likely be a primary driver of the housing market demand in 2021
Half of Canadians (53%) are confident that Canada’s housing markets will remain steady in 2021
52% of Canadians believe real estate will remain one of the best investment options in 2021
“We’ve seen a lot of anecdotal evidence since the summer that households are considering significant lifestyle changes by relocating to less-dense cities and neighbourhoods,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “This has sparked unprecedented sales this year in suburban and rural parts of Canada and we expect this trend to continue in 2021.”
Like many GTA regions, the Mississauga housing market experienced a slowdown in mid-March, with all activity decreasing by as much as 80% and not picking up again until early to mid-April. According to the RE/MAX Fall Market Outlook Report, the halt of this typically busy spring real estate market has meant that the summer months have seen abnormally high levels of activity. The pent-up demand has resulted in multiple-offer scenarios, putting significant upward pressure on prices.
With demand exceeding supply across the Mississauga housing market and the GTA as a whole, it is expected that prospective buyers will continue engaging in the market aggressively into the fall season. A 5% increase in average residential sale price is expected in Mississauga for the remainder of the year.
Ontario Real Estate Trends
What’s been happening across other Ontario real estate markets? With the province being one of the hardest-hit regions in Canada, markets such as Niagara, Mississauga and Kitchener-Waterloo experienced significant drops in activity. However, come June, they bounced back aggressively as economies began to reopen. With all of Ontario now in phase three of re-opening and consumers more comfortable engaging in the market, market activity in Ontario is expected to remain steady in the fall, with modest price increases of up to 6% in some regions.
Leading indicators from RE/MAX brokers and agents across Canada’s housing market point to a strong market for the remainder of 2020. According to the RE/MAX Fall Market Outlook Report, RE/MAX brokers suggest that the average residential sale price in Canada could increase by 4.6% during the remainder of the year. This is compared to the 3.7% increase that was predicted in late 2019.
The pandemic has prompted many Canadians to reassess their living situations. According to a survey conducted by Leger on behalf of RE/MAX Canada, 32% of Canadians no longer want to live in large urban centres, and instead would opt for rural or suburban communities. This trend is stronger among Canadians under the age of 55 than those in the 55+ age group. Not only are Canadians more motivated to leave cities, but changes in work and life dynamics have also shifted their needs and wants for their homes. According to the survey, 44% of Canadians would like a home with more space for personal amenities, such as a pool, balcony or a large yard.
Canadians equally split on their confidence in the housing market
Canadians are almost equally split in their confidence in Canada’s real estate market, with 39% as confident as they were prior to the pandemic, and 37% slightly less confident. When it comes to the prospect of a second wave of COVID-19, 56% of Canadians who are feeling confident in Canada’s real estate market are still likely to buy or sell. “The classically hot spring market that was pushed to the summer months due to the COVID-19 pandemic created a surprisingly strong market across Canada and across all market segments,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Looking ahead, government financial aid programs may be coming to an end in September, which could potentially impact future activity; however, the pent-up demand and low inventory dynamic may keep prices steady and bolster activity for the remainder of 2020. Overall, we are very confident in the long-term durability of the market.”Additional highlights from the 2020 RE/MAX Fall Market Outlook Report Survey:
48% of Canadians would like to live closer to green spaces
48% of Canadians say it’s more important than ever to live in a community close to hospitals and clinics
33% of Canadians would like more square footage in their home and have realized they need more space
44% of Canadians want a home with more outdoor space and personal amenities (i.e. balcony, pool etc.)
About the 2020 RE/MAX Fall Market Outlook Report The 2020 RE/MAX Fall Market Outlook Report includes data and insights supplied by RE/MAX brokerages. RE/MAX brokers and agents are surveyed on market activity and local developments.
Seller’s market to prevail in 2020, prices to increase 5%
The Mississauga housing market will lean toward sellers in 2020 across most property types, with the average residential sale price expected to rise by five per cent thanks to increased consumer confidence and historical price appreciation.
The Mississauga housing market experienced steady growth after taking a dip in 2017. Affordability remains a concern for homebuyers with the tightening of inventory and the corresponding upward pressure on pricing. This challenge will continue into 2020.
Thirteen per cent of the new housing starts in the Greater Toronto Area in 2019 took place in Mississauga according to Canada Mortgage and Housing Corp. This construction trend is expected to continue in 2020, bringing some relief to the inventory shortage in the region, and a corresponding moderation in the high single-digit price increases in Mississauga’s condominium sector.
Easy access to Toronto’s downtown core via Mississauga’s main thoroughfares and GO Transit will continue to have an impact on the market. The hottest neighbourhood for Mississauga home sales is the area around Square One, due to the many affordable condo units found here. Lisgar/Churchill Meadows are also in high demand due to the affordable newer homes that require little maintenance. Clarkson is also a popular choice for homebuyers thanks to its relative affordability compared to the surrounding area, as well as easy access to GO Transit and the QEW.
First-time homebuyers are expected to propel the Mississauga housing market in 2020, attracted to the area by the high concentration of relatively affordable condos found here.
From a national perspective, RE/MAX anticipates a leveling out of the highs and lows that characterized the Canadian housing market in 2019, particularly in Vancouver and Toronto, as we move into 2020. Healthy price increases are expected, with an estimated 3.7-per-cent increase in the average national residential sales price, according to the RE/MAX 2020 Housing Market Outlook Report.
Most individual markets surveyed across Canada experienced moderate price increases year-over-year from 2018 to 2019. However, some regions in Ontario continue to experience higher-than-normal gains, including London (+10.7 per cent), Windsor (+11 per cent), Ottawa (+11.7 per cent) and Niagara (+12.9 per cent).
“Southern Ontario is witnessing some incredibly strong price appreciation, with many regions seeing double-digit gains,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Thanks to the region’s resilient economy, staggering population growth and relentless development, the 2020 market looks very optimistic.”
Lydia McNutt is an award-winning editor, with more than two decades of experience specializing in Canadian real estate. At RE/MAX, Lydia is responsible for developing consumer-facing content while promoting the RE/MAX brand through housing market reports and market news, as featured on the RE/MAX Canada blog and social media channels. Lydia has been published nationally on topics ranging from real estate, architecture, decor and design, to finance, business, technology, entertainment and lifestyle. When she’s not head-down at her writing desk, Lydia is busy “momming” in Oakville, Ontario, where she lives with her husband, two kids and their chocolate lab, Betty. Email Lydia at email@example.com