Sales were down but home prices were still up in December 2017 in the Greater Toronto Area, according to the Toronto Real Estate Board.
The average GTA property sold for $735,021 in December 2017, compared to $730,124 in December 2016.
While year-over-year prices were just 1% higher, month-to-month prices saw an unexpected drop of 4%, with buyers and sellers likely more interested in shopping and family time than trudging around in the snow house-hunting.
Condo sales carried the market this December, with a 14.4% year-over-year increase, while detached houses saw a 2.5% price decline.
“It is interesting to note that home price growth in the second half of 2017 differed substantially depending on market segment. The detached market segment – the most expensive on average – experienced the slowest pace of growth as many buyers looked to less expensive options. Conversely, the condominium apartment segment experienced double-digit growth, as condos accounted for a growing share of transactions,” says Jason Mercer, TREB’s director of market analysis.
Overall, average property prices rose a healthy 12.7% to $822,681 in 2017.
Sales, on the other hand, dropped dramatically this year by 18.3% to 92,394 units sold, from 2016.
December is always a predictably slow sales month, but this one was especially so: sales were down to 4,930 from 5305 the year before, and 7,374 in November.
The downturn is likely due to a surge of inventory. Sellers appear eager to get their homes to market amid uncertainty due to changing government regulations.
The year saw two major pieces of government legislation affect the market: the introduction of the Ontario Fair Housing Plan (FHP) in April and the announcement of tighter mortgage lending rules, which came into effect this Jan. 1.
The FHP “had a marked psychological impact on the marketplace”, says TREB’s president, Tim Syrianos.
Indeed, most of the year’s price growth occurred prior to FHP, during the first four months of the year, which experienced record sales. Price growth cooled during the remainder of the year, but sales picked up in the final quarter of the year as the impact of the FHP started to wane.
Danielle Kubes is a content writer for Zoocasa.com, a leading real estate resource that combines online search tools and a full-service brokerage to empower Canadians to buy or sell their homes faster, easier and more successfully. Home buyers can browse Toronto real estate listings, to find Toronto condos, or houses for sale in Toronto.