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Last month, the price for detached properties sold in suburban Toronto averaged a new high of $999,102, a 27.8-per-cent surge compared with January, 2016.

Melissa Renwick/The Globe and Mail

The market is sizzling for detached houses in Toronto's suburbs, approaching an average price of $1-million.

Last month, the price for detached properties sold in suburban Toronto averaged a new high of $999,102, a 27.8-per-cent surge compared with January, 2016.

While detached homes within the City of Vancouver remain by far the most expensive in Canada for any municipality, some of Toronto's suburbs are now edging closer to prices found in communities near Vancouver.

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For instance, the median price for detached properties sold last month reached $1.37-million in Markham, north of Toronto, compared with $1.56-million in Richmond, south of Vancouver.

In the months since Canada Mortgage and Housing Corp. warned last October about high housing prices in and around Vancouver and Toronto, the Greater Toronto Area has continued to boom while the Vancouver region cooled off.

Sales in the GTA climbed to 5,188 transactions in January for an 11.8-per-cent gain over the same month in 2016.

The price for detached houses sold within the City of Toronto last month averaged $1.34-million, down 0.7 per cent from the record $1.35-million in November but up 26.8 per cent from a year earlier.

In the GTA, the price for detached properties averaged a new high of $1.07-million last month, or a 26.3-per-cent jump from January, 2016.

The number of total active listings in the GTA plunged to 5,034 last month – roughly half the amount of supply of various housing types a year earlier, the Toronto Real Estate Board's director of market analysis Jason Mercer said. "We're experiencing some of the tightest market conditions on record," he said in an interview Friday.

For the GTA's residential market as a whole, the average price was a near-record $770,745 in January, or a 22.3-per-cent increase from the same month of 2016.

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"Toronto's housing market hit another one out of the park," Bank of Montreal senior economist Sal Guatieri said in a research note. He described the price increases in the GTA as "likely the frothiest gains since the late 1980s."

In suburban Toronto (known for its 905 area code), the price for condos sold last month averaged $379,169, up 18.5 per cent from a year earlier, while sales volume soared 26.5 per cent.

Also in the condo segment, prices averaged $442,598 in the GTA last month, compared with $582,965 in the Real Estate Board of Greater Vancouver's sprawling territory. Average prices for condos have risen in both markets over the past year, gaining 14.5 per cent in the GTA and 12.7 per cent in Greater Vancouver.

The B.C. government implemented a 15-per-cent tax on foreign home buyers in Metro Vancouver, effective last August. And in October, Ottawa tightened mortgage lending rules so that applications from borrowers are stress tested at the Bank of Canada's posted interest rate of 4.64 per cent for insured mortgages.

In the Vancouver region, "the cooldown owes partly to fewer non-resident buyers post-tax, and poor affordability, with most of the downward price pressure in the super-expensive detached segment," Mr. Guatieri said.

With fewer luxury sales, the average price for detached houses sold within the City of Vancouver has dropped, though it remains above $2.2-million.

A new real estate report from Royal LePage analyzing trends in the last quarter of 2016 suggests that the GTA will become the hottest housing market in the country in 2017, surpassing Vancouver.
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