Annual Rate of Price Growth Accelerates
As the holiday season hits, the forecast for the Greater Toronto Area real estate market shows positive developments.
According to TREB Chief Market Analyst Jason Mercer, “Strong population growth in the GTA coupled with declining negotiated mortgage rates resulted in sales accounting for a greater share of listings in November and throughout the second half of 2019.”
The latest Toronto Real Estate Board (TREB) report disclosed 7,090 residential sales in November 2019, indicating a 14.2 percent increase compared to the same period last year. This increase falls in step with positive annual sales growth across all the major market segments, specifically in detached and ground-oriented homes (those that have direct street access). However, owing to continuous tight market conditions as seen last month, the number of new and active listings entered into the system show a year-over-year decrease of 17.9 and 27.2 percent, respectively.
Combined with a progressively restrained supply of listings, competition between buyers, and high demand, these market conditions have accelerated the annual rate of price growth, resulting in an MLS Home Price Index Composite Benchmark year-over-year to increase 6.8 percent. The average selling price totalled $843,637, up 7.1 percent on last year.
If the listing supply continues to stagnate, the rate of price growth is only expected to accelerate further into the new year. This is good news for current homeowners, and it might be a nudge for buyers on the fence to go ahead and take the plunge.
Condo Market Holds Steady this Holiday Season
The results are in! The Toronto Real Estate Board’s (TREB) latest report recorded 7,090 residential sales in November 2019, a 14.2 percent year-over-year increase. The rise in annual sales positively affected all major market segments, with particular growth shown in ground-oriented home types (those that have direct street access) and detached houses. But how did the condo market fare?
Condominiums continue to be popular, despite Toronto’s tight market conditions, which are characterized by a 17.9 percent decrease in new listings and overall high buyer demand. Second, only to the detached housing market, condos brought in a total of 1,902 sales last month, holding steady at a 1.0 percent increase from last November’s sales.
According to TREB president Michael Collins, “An increasing number of home buyers impacted by demand-side policies over the past three years, including the 2017 Ontario Fair Housing Plan and the OSFI mortgage stress test, have moved back into the market for ownership housing.” Ultimately, affordability and stricter mortgage qualifications have influenced buyer’s home type and location preferences, making condos a reliable choice.
The average price of condos ($617, 658 for November 2019) saw an 11.1 percent year-over-year increase, but it is still the most economical of the sectors, followed closely by townhouses, with an average price of $666,744.
As the regional supply crisis continues to be of concern and the rate of price growth increases exponentially, it will be interesting to see how the condominium market reacts in 2020.
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