Sales activity took a drastic slide in the Greater Toronto Area (GTA) following the introduction of the Ontario Fair Housing Plan—but that downward trend may be starting to reverse, according to the October data from the Toronto Real Estate Board (TREB).
While annual sales are nearly 27% below last year’s levels, the board reveals a stronger-than-usual 12% uptick in activity month over month, with 7,118 homes sold. And that’s not just the biggest increase seen in recent months—it’s an abnormally large jump for the market in general, says TREB president Tim Syrianos.
“Every year, we generally see a jump in sales between September and October,” he says. “However, this year that increase was more pronounced than usual compared to the previous 10 years. So, while the number of transactions was still down relative to last year’s record pace, it certainly does appear that sales momentum is picking up.”
The average price for all home types in the TREB region is up 2.3% year over year to $780,104.
Demand highest for affordable home types
Sales may be down year over year across all home types, but each segment experienced a slight lift from September’s activity.
Detached home sales, which began to show promise of recovery mid-month, continued to improve in the last two weeks of October, rising 13% (though still drastically below 2016 levels by 29.8%). Prices softened slightly year over year by 2.5% to an average of $1,008,207.
Semi-detached home sales improved 9% over the month (but were down 23.5% year over year), with prices up 6.3% to $764,293.
The biggest jumps in price were seen in the townhouse and condo segments; sales for Toronto townhouses fell 22% from last year but recovered 13% month over month, with the average price rising 7.4% to $629,507. Condos, while dropping nearly 25% year over year, greatly outpaced all other home types in price growth surging 21.8% from last year to an average of $523,041, following a 9% monthly sales increase.
Year-over-year October home sales and price differences (2017)
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Signs of market recovery?
Jason Mercer, TREB’s director of market analysis, says that conditions appear to be slowly normalizing in the months following the provincial market rules announcement, similarly to how Vancouver has recovered following the introduction of its foreign buyer’s tax in August 2016.
“The housing market in the GTA has been impacted by a number of policy changes at the provincial and federal levels,” he says. “Similar to the track followed in the Greater Vancouver Area, it appears that the psychological impact of the Fair Housing Plan (OFHP), including the tax on foreign buyers, is starting to unwind.”
He adds that TREB will be undertaking its annual buyer survey in the last two months of the year, and will be collecting data on the impact of such rules which include the OFHP, new mortgage guidelines, as well as a potential vacant homes tax in Toronto.