“The lack of available inventory, coupled with record sales, continued to translate into robust annual rates of price growth.” These are the words of Mark McLean, the President of Toronto Real Estate Board, and they pretty much sum up the current situation on the Toronto real estate market. Things are moving on the predicted trajectory so far and the upcoming months, which are statistically the high points of the whole year, won’t bring any change.
The numbers from April speak for themselves. The number of sales recorded through the TREB’s MLS® System was 12,085, which is a 7.4 per cent increase when compared to 11,254 recorded in April 2015. Sales could have been even higher, but some of the potential sellers in the City of Toronto area decided to withhold listing their properties for sale, which caused a lack of supply in the especially in the low-rise segment. According to Mr. McLean, the reason for this might be “the second substantial Land Transfer Tax and associated administration fee.”
The growth of the average prices was significant as well. One of the main reasons was higher sales results in the high-end segment of homes. The average price recorded in April last year in the Greater Toronto Area was $636,094 and has risen by 16.2 per cent to this year’s $739,082. The lack of inventory is quite obvious and is best illustrated by comparing the number of active listings. There were 17,182 properties listed on the market last year. In April 2016, there were only 12,554, which is a stunning 26.9 per cent decrease.
“As we move into the busiest time of the year, in terms of sales volume, strong competition between buyers will continue to push home prices higher. A greater supply of listings would certainly be welcome, but we would need to see a number of consecutive months in which listings growth outpaced sales growth before market conditions become more balanced,”
said Jason Mercer, TREB’s Director of Market Analysis.
Despite the more difficult process of getting a mortgage when buying house for the first time, the sales and average prices are about to continue rising and the demand is about to get more and more thin. Feel free to contact our team with any questions regarding both buying and selling real estate. We'll be more than happy to help!