The Toronto real estate market has remained hot despite the Bank of Canada’s aggressive interest rate hikes over the past year.
In a report by Zoocasa released on Monday, it showed dollar volume for home purchases was up in 22 Toronto neighborhoods compared to a decrease in just 12.
The report calculated dollar volume through the sum of the prices of all properties sold within the regions.
The largest dollar volume increase for a home was in the Parkwoods, Don Mills and Victoria Village neighborhoods, where volumes rose by 199 per cent in May compared to the same time last year, the data revealed. Whereas in Scarborough, dollar volume increased by the slowest amount at one per cent, however, home sales were down to 47 compared to 54 last May, it showed.
The city’s condo market revealed similar trends.
Dollar volume for condominiums was up in 23 Toronto neighborhoods in comparison to a decline in only six neighborhoods.
“This is more likely due to the increased popularity of condos in the last year as a more affordable property type, with how oppressively expensive freehold homes can be in the city coupled with the higher cost of borrowing,” the report said.
The greatest increase in dollar volume for condos was in the region of York Mills, the Bridle Path, and Hoggs Hollow, which gained by 169 per cent, the data showed.
The report suggests the overall increase in dollar volume is coming from the predictability of borrowing costs as the Bank of Canada held its overnight lending rate at 4.5 per cent for several months. However, the central bank did hike rates in June by 25 basis-points which was largely unexpected by economists.
“Even though conditions are tighter in terms of interest rates and prices, it seems previously reluctant buyers have adjusted to the reality of climbing mortgage rates and have moved off the sidelines,” the report said.