Toronto area home prices climbed in August, and sales grew compared to the same month last year, signalling the region’s real estate market is continuing to sputter back to life after a weak first half of the year.
The Toronto Real Estate board said 6,839 homes sold in the Greater Toronto Area in August, an increase of 8.5 per cent compared to August last year and a jump of 2 per cent compared to July after adjusting for seasonal variations.
August was the third consecutive month that home sales have climbed in the GTA on a year-over-year basis and came on the heels of an even larger 18.6-per-cent jump in home sales in July.
The average selling price for all types of homes was $765,270 in August, an increase of 4.7 per cent compared to August, 2017, but a slight decline of 0.2 per cent compared to July on a seasonally adjusted basis.
TREB president Garry Bhaura said it is encouraging to see “a continued resurgence” in demand from buyers who have been reluctant to get into the market since the Ontario government announced a package of policy reforms – including a new foreign-buyers tax – in April, 2017, and since the federal government toughened mortgage eligibility rules on Jan. 1 of this year.
“Many home buyers who had initially moved to the sidelines due to the Ontario Fair Housing Plan and the new mortgage lending guidelines have renewed their search for a home and are getting deals done, much moreso than last year,” Mr. Bhaura said in a statement.
Sales of detached homes, in particular, continued to show signs of improvement after a weak start to the year, with the number of detached houses sold in the GTA climbing 17.7 per cent in August compared to last year.
Average prices for detached homes rose 1.2 per cent, with prices in the City of Toronto up 4.9 per cent to an average of $1,244,275, while detached house prices in the suburban 905 region outside Toronto rose just 0.3 per cent to $907,780 on average.
Jason Mercer, TREB’s director of market analysis, said the ratio of sales to available inventory was tighter this summer than last summer.
“We have only slightly more than two-and-a–half months of inventory in the TREB market areas as a whole, and less than two months of inventory in the City of Toronto,” he said in a statement.
Although the number of homes sold this year is down from record highs in 2016 and 2017, many neighbourhoods in Toronto continue to have a lack of inventory for buyers who are shopping for a home, he said.
“This could present a problem if demand continues to accelerate over the next year, which is expected,” Mr. Mercer said.
The condominium market, which has been the region’s strongest sector over the past 15 months, showed sharply diverging trends in August, with condo sales falling by 5.6 per cent in the City of Toronto while rising 18.6 per cent in the suburban 905 region surrounding the city, TREB reported.
However, sale prices for condos rose in both the City of Toronto and 905, climbing 6.4 per cent on average across the region to $541,106 in August.
Janet McFarland