GTA May Home Sales Plunge Again – 22%

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GTA May Home Sales Plunge Again – 22%

On Monday, The Toronto Real Estate Board (TREB) released its Monthly Market Figures for the month of May, and home sales across the Greater Toronto Area are down, once again, when compared to the same time last year.

Photo Source: Nathan Fertig

According to the report, the number of home sales for May was 7,834 units, a 22.2 per cent decline when compared to May 2017. The average selling price for all home types also fell 6.6 per cent to $805,320, and new listings decreased by 26 per cent to $19,002, when compared year-over-year. These numbers are a clear indication that the once overheated market is now beginning to cool. However, while the number of sales was down, the annual rate of decline was less than reported in February, March, and April, when transactions were down by more than 30 per cent. The average selling price also rose 1.1 per cent in May compared to April on a seasonally adjusted basis.

Photo Source: Alex Sawyer

Detached and semi-detached homes are seeing the steepest declines when compared to condos. The condo sector is continuing its gains, increasing 5.7 per cent to $562,892, while average detached home prices dropped 8.2 per cent to $1,045,553 when compared year-over-year. The city of Toronto saw the biggest jump in condo prices of 6.5 per cent, to $602,804. Detached home prices in the City of Toronto were only down 5.6 per cent to an average of $1,426,094 on a year-over-year basis, while prices for detached houses in the 905 Region was down 9 per cent to an average of $929,401 when compared year-over-year. According to Jason Mercer, the board’s Director of Market Analysis, there are emerging indicators that there is increased competition between buyers, which will lead to stronger price growth in the latter half of the year. “Market conditions are becoming tighter in the Greater Toronto Area and this will provide support for home prices as we move through the second half of 2018 and into 2019. In the City of Toronto, for example, average selling prices were at or above average listing prices for all major home types in May.”

Photo Source: Tu Tu

Housing supply continues to be an issue for residents and prospective home buyers. President of TREB, Tim Syrianos, reiterated the importance of additional ground-level housing, or “the missing middle.” “In a recent Canadian Centre for Economic Analysis study undertaken for the Toronto Real Estate Board, it was found that many people are over-housed in Ontario, with over five million extra bedrooms.” Syrianos states. “These people don’t list their homes for sale, because they feel there are no alternative housing types for them to move into. Policymakers need to focus more on the ‘missing middle’ – home types that bridge the gap between detached homes and condominium apartments.” The lack of affordable housing and supply will be a persistent issue leading up to the June 7 election, and will largely influence voters’ decisions. According to a recent poll done by Ipsos, 69 per cent of respondents agree that the platforms each political party takes on housing affordability will strongly influence their voting decision, while 56 per cent believe the government should focus on the fixing the supply and lessening the demand for housing by building additional home types…hence…#moremissingmiddle.

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