The latest numbers from the Toronto Real Estate Board (TREB) show the market continues to experience double-digit declines from its activity one year ago. Monthly sales fell 34.8% across the Greater Toronto Area (GTA) in August. The average home price was $732,292—just 3% higher than in 2016 and well below the plus-30% gains experienced at the market’s peak in March.
This slower activity should be welcomed by buyers, says TREB director of market analysis Jason Mercer, as the “relationship between sales and listings in the marketplace today suggests a balanced market.”
Lower-priced homes top performers
Affordability continues to be the main factor behind market trends. Lower-priced home types, such as condos, semi-detached, and Toronto townhouses for sale continued to perform well while the higher-priced single-family and luxury home segment has steeply declined. Over the last year, the average price of a GTA condo rose 21.4% to $507,841, while townhomes are now 8.9% pricier at $605,618. Semi-detached prices are up 12.1% to $715,167.
A decline in detached home sales
Meanwhile, detached house sales have fallen 41.6% across the GTA year over year and the average price has dipped below a million to $968,494. Steep affordability has effectively sidelined many prospective buyers in the city, or prompted them to cast their real estate net further, instead seeking Niagara or Hamilton condos for sale.
This trend can be seen across the GTA, with double-digit price drops in the majority of TREB regions compared to April 2017:
Fewer homes for sale in August
August inventory also measured in at a seven-year low, with just 11,523 homes listed for sale. That’s a turnaround from the flood of homes for sale that became available in the months following the implementation of the Ontario Fair Housing Plan. Mercer says that supply returning to tighter conditions could set the stage for a reheating market come autumn.
“If current conditions are sustained over the coming months, we could expect to see year-over-year price growth normalize slightly above the rate of inflation,” he says. “However, if some buyers move from the sidelines back into the marketplace, as TREB consumer research suggests may happen, an acceleration in price growth could result if listings remain at current levels.”
Fall could be warmer real estate market
He and TREB president Tim Syrianos expressed optimism in TREB’s release that buyers will return in force to the fall market, as incomes and a booming economy support home buying behaviour.
“Recent reports suggest that economic conditions remain strong in the GTA,” says Syrianos. “Positive economic news coupled with the slower pace of growth we are now experiencing could prompt an improvement in the demand for ownership housing, over and above the regular season bump, as we move through the fall.”