Is the Mississauga real estate market immune to the impacts of the highly infectious respiratory illness, or are other factors at play? Like many other Canadian housing markets, Mississauga enjoyed double-digit growth in 2020, despite the coronavirus pandemic that effectively paused the national economy and shut down the nation.
Last year, Mississauga’s housing market saw residential prices grow almost 16 per cent to $880,374. This was just below the Toronto housing market’s average selling price of $918,883. Indeed, the real estate recovery over the course of 2020 has been robust for Mississauga and other housing markets in the province of Ontario, as well as the rest of the country.
Many elements have been working in the sector’s favour, from ultra-low interest rates to an industry adapting to the COVID-19 public health crisis with digital tools. But as the real estate market balloons, there is a danger that higher prices could serve as a barrier to entry for many newcomers.
Mississauga Real Estate Market Favours Sellers Coming Into 2021
The year has only just begun, and it already looks like the Mississauga real estate market is going to have another impressive year, based on the January data alone.
According to the Mississauga Real Estate Board (MREB), residential sales surged 44.6 per cent year-over-year in January, the largest number of housing transactions recorded in the month of January since 2008.
Real estate prices also charged ahead to kick off 2021, with the MLS® Home Price Index (HPI) composite benchmark price rising 12 per cent from the same time a year ago to $993,300. Here’s how the various Mississauga property types performed in January on a year-over-year basis:
- Single-Family Home: +15.3% to $1,172,500
- Townhouse/Row Unit: +27.3% to $814,400
- Apartment: -1.9% to $569,700
With nationwide reports of demand outpacing supply, industry observers have been concentrating on several key metrics: listings, months of inventory and housing starts.
New residential listings rose 21.2 per cent to 859, the largest number of new listings added in the month of January. Active residential listings also climbed 7.6 per cent to 655.
There was just one month of inventory by the end of January, down from 1.4 months at the same time a year ago. This is below the long-run average of two months for this time of the year. This is considered a crucial measurement because it reflects the number of months it would take to sell current housing stock at the present rate of sales.
The latest new-home data (January to September 2020) found that housing starts slumped 64.9 per cent, compared to the 84.9 per cent and 128.8 per cent growth in neighbouring Brampton and Caledon.
“Although market conditions are tight by historical standards, we are still some way off from seeing inventory levels drop to record lows. This is keeping benchmark price gains in the low double digits with the exception of apartment units, which recorded their first year-over-year price decline in nearly three years,” said Asha Singh, President of the Mississauga Real Estate Board, in a news release.
But will these conditions continue throughout 2021?
Mississauga Market Expected to Continue in Sellers’ Favour
Although the Mississauga housing sector is not experiencing a significant chasm between supply and demand, market analysts are warning about the growing level of demand for the city’s real estate. Low inventory has been a problem throughout Ontario, and the Mississauga housing market is forecast to favour sellers in 2021, according to the RE/MAX Mississauga Housing Market Outlook (2021).
With housing stocks likely to put pressure on prices, Mississauga real estate prices are forecast to rise four per cent to a little more than $915,000. It is anticipated the market will be driven by young couples and move-up buyers, with demand for condominiums and luxury markets leading the way.
Evolving consumer trends are also expected to play a big role in the Mississauga housing market. More professionals are enjoying remote work options, while families are leaving major urban centres for homes with more space at a cheaper price. Of course, historically low interest rates are facilitating homebuyers’ desire for more square footage at a lower cost.
Overall, what happens over the next 12 months in the broader economy could have a lasting impact on multiple sectors, including real estate.
“The next 12 months will be critical as we chart our path through recovery. In particular, the impact of resumption in immigration and the reopening of the economy will be key,” said Jason Mercer, chief market analyst at the Toronto Regional Real Estate Board (TRREB), in a statement.
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