TORONTO -- A lack of homes for sale is expected to drive Toronto's sizzling housing market to another year of double-digit price increases, the city's real estate board said Tuesday.
The Toronto Real Estate Board said the average price for all types of housing is forecast to rise to about $825,000 -- up from $730,472 in December and $729,922 for the 2016 calendar year.
The largest year-over-year price increases will be for low-rise types of housing such as detached and semi-detached homes and townhouses, said the board, which represents about 46,000 real estate brokers and salespersons.
"While changes to federal mortgage lending guidelines and higher borrowing costs may impact some would-be homebuyers, the big impediment will be the lack of inventory," Jason Mercer, the board's director of market analysis, said in a statement.
The number of listings at the end of December were at their lowest since before 2000, Mercer said.
"It is unlikely that the shortage of listings will improve to any great degree over the course of the next year," he said. "This will put a ceiling on sales growth."
The board estimates there will be between 104,500 and 115,500 home sales this year through its MLS system -- more or less similar to the 113,133 recorded last year.
The group is repeating its call for the private, public and not-for-profit sectors to seek solutions to increase the supply of properties for sale in the Toronto region rather than attempt to reduce demand from would-be buyers.
It said a foreign buyers' tax, which some called for to rein in Toronto house prices after such a levy was implemented in Vancouver, would be misguided. It pointed to a survey it conducted among its members late last year that concluded 4.9 per cent of transactions in the Greater Toronto Area involved foreigners.
After a tax on foreign nationals buying property in Vancouver was introduced in August, the city saw a whopping drop in the number of homes sold -- in some cases, monthly sales fell between 30 to nearly 40 per cent on a year-over-year basis.