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Re/Max’s 2017 outlook report forecasts sales volume to slip next year in the GTA, but the region will remain a seller’s market.Mark Blinch/The Globe and Mail

Real estate firm Re/Max expects the Greater Toronto Area's housing market to roar ahead in 2017, forecasting average residential prices will rise 8 per cent in the region.

Re/Max's prediction for the GTA is well above its expectation of a 2-per-cent increase in average prices nationally for various housing types.

The B.C. government implemented a 15-per-cent tax on foreign home buyers in the Vancouver region effective on Aug. 2, and the ripple effects of that will be felt into 2017, the real estate firm said in its housing outlook.

"The foreign-buyer tax in Vancouver shifted some foreign investors' attention to the Toronto market in the second half of 2016. It is anticipated that foreign buyers will continue to be more active in the GTA in 2017," Re/Max said.

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Re/Max's forecast for 2016 expected the GTA to have an average price of nearly $725,900 this year for housing such as single-family homes, condos and townhouses. It put the average price increase in GTA's residential market at 16.7 per cent, compared with jumps of 9.8 per cent in 2015 and 8.3 per cent in 2014.

With prices climbing steadily in the GTA, many buyers are looking farther afield for less-expensive options, including in Barrie and Hamilton.

Re/Max said Greater Vancouver could see the average residential price increase 2 per cent in 2017. While the Vancouver region's sales activity has cooled off since peaking in March, Re/Max said other parts of British Columbia are attracting attention, notably Kelowna in the Okanagan and communities in the Fraser Valley.

The B.C. Real Estate Association recently forecast that the average price for detached houses, condos and townhouses sold in Greater Vancouver will be $940,000 next year, down 8.7 per cent from $1.03-million this year.

The federal government tightened mortgage rules in October, introducing a tougher standard for gauging whether home buyers can handle an eventual increase in interest rates.

"Measures taken by the federal government to tighten mortgage insurance criteria for new home buyers [are] expected to temper local first-time buyer activity across the country in the short term, but [are] not expected to have a long-term impact in most regions," Re/Max said.

The outlook report forecast sales volume to slip 5 per cent next year in the GTA, but the region will remain a seller's market: "Single-family homes are in high demand, particularly from foreign buyers who are taking advantage of the low Canadian dollar. As baby boomers look to downsize to high-end condos, new single-family detached homes in the upper end of the market are expected to become available in 2017."

Christopher Alexander, regional director of Re/Max Integra's Ontario-Atlantic Canada region, said he sees strong housing demand in the country's urban markets next year.

Even so, some markets have yet to show any sign of a rebound, including Calgary, which had 1,227 housing sales in November, down almost 3 per cent from the same month in 2015.

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