Sun Continues to Shine on Summer Market.
June marked a change in temperature in Toronto – both outside and in the real estate market.
According to the latest market report from the Toronto Real Estate Board (TREB), things are looking sunnier than they have in a while. Real estate agents in the GTA reported 8,082 home sales in June, a 2.4% increase compared to June 2017. After accounting for the preliminary seasonal adjustment, home sales were also up 17.6% from May 2018 to June 2018.
Home sales weren’t the only recorded gains in June. The average selling price increased to $807,871 – a 2% increase from June 2017. The average selling price also rose by 3.3% (after preliminary seasonal adjustment) month-over-month between May 2018 and June 2018.
“After some adjustment to the Fair Housing Plan, the new Office of The Superintendent of Financial Institutions (OSFI) stress test requirement and generally higher borrowing costs, home buyers are starting to move back into the market, with sales trending up from last year’s lows,” says Garry Bhaura, the TREB’s new president. There was some decline recorded in June: the number of new listings was down by 18.6% when compared with June 2017.
“The expectation is to see improvement in sales over the next year. Over the same period, however, it is likely that issues surrounding the supply of listings will persist,” says Jason Mercer, the TREB’s director of market analysis. “This suggests that competition between buyers could increase, exerting increased upward pressure on home prices.”
Declining Inventory Could Boost Condo Prices.
The latest market report from the Toronto Real Estate Board (TREB) delivered all around good news for the Greater Toronto Area real estate market. Both selling prices and the number of sales saw increases from month to month and year over year.
In the condo market, prices rose in June, continuing a months-long trend. In the 905 region, prices were up by 3.4%, bringing the average price to $450,672. In the 416, the increase was more dramatic at 9.5%; the average price rose to $605,530 in June. As similarly observed in May, condo sales in the GTA were down in the month of June. While the number of sales of detached and semi-detached homes in the GTA rose by 5.5% and 8.1% year over year, the number of condo sales was down by 5.3%. New inventory of all home types also saw a year-over-year decline of 18.6%.
Taking into account factors such as the stress test requirement and higher borrowing costs, entering the market remains difficult, especially for young and first-time buyers, who historically have turned to condos as a more attainable home ownership goal. Market conditions could be causing prospective buyers to hold off on making a purchase, while low inventory could create more competition between those ready to make the jump.
“It is likely that issues surrounding the supply of listings will persist,” says Jason Mercer, the TREB’s director of market analysis. “This suggests that competition between buyers could increase, exerting increased upward pressure on home prices.”