Homes priced under 0,000 are vanishing across Ontario

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Homes priced at under $500,000 are becoming a rarity in Ontario, with fewer than one in five dwellings falling under that threshold, new data from a government-run property assessment group shows.

A decade ago, 74 per cent of Ontario’s residential properties were valued under $500,000, and 91 per cent were below $750,000. Today, those figures have dropped to 19 per cent and 48 per cent, respectively, according to figures released this past week by the Municipal Property Assessment Corporation (MPAC).

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As of December 2023, the median home value in Ontario has soared to $765,000, with the Greater Toronto and Hamilton Area (GTHA) witnessing an even steeper climb to a median of $1,031,000.

Even in smaller communities outside the Greater Toronto and Hamilton Area (GTHA) affordability is vanishing.

In St. Catharines, for example, the percentage of homes under $500,000 has plummeted from 96.9 per cent to 30.1 per cent.

Options below $500,000 are now largely confined to cities such as Sudbury, Sault Ste. Marie, North Bay, Thunder Bay and Windsor, with slightly more options available under $750,000 in cities including Ottawa, London, Kitchener, Kingston, Barrie and Peterborough.

Greg Martino, vice-president of MPAC, said no single factor has caused the change.

“The reality is that current home prices are a reflection of various economic forces at play,” Martino said in the group’s assessment. “Factors like supply and demand, increased construction and labour costs plus inflation are all part of what’s driving today’s house prices.”

Condo markets have seen a similar erosion of affordability. In 2013, 88 per cent of the GTHA’s residential condominiums were valued at under $500,000, with a median price hovering around $325,000. Fast forward to today, and the landscape has shifted dramatically, with just over 11 per cent of condos in the GTHA falling under $500,000. The median value of a condominium in the area has now surged to over $645,000.

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In Toronto proper, the percentage of condos valued under $500,000 has dropped from nearly 85 per cent to less than 11 per cent over the past decade.

Semi-detached homes and town houses have not been spared from this trend. Back in 2013, a vast majority — 94 per cent of semi-detached properties and 97 per cent of townhouses — were available for $750,000 or less. Today, only 33 per cent of semi-detached homes and 46 per cent of townhouses remain within that price bracket.

“When looking at a value of $500,000 or less, the inventory drops to just 13 per cent for semi-detached and four per cent for town houses,” the assessment said.

Meanwhile, the median home value for a detached home in Ontario has increased by 128 per cent, from nearly $378,000 in 2013 to over $862,000 today.

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Currently, 41 per cent of detached homes in the province are valued at over $1 million, a significant increase from just six per cent in 2013. In the GTHA specifically, the rise is even more pronounced, with over 78 per cent of detached homes now exceeding the $1 million mark, compared to nearly 12 per cent ten years ago.

The Municipal Property Assessment Corporation is responsible for managing a database of over five million properties. Its primary role is to accurately assess property values for homeowners, local governments, and businesses.

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