New Home Ownership in the Greater Toronto Area

 

Here are some interesting insights from CMHC on new homes in the GTA. According to their research, condominium sales are slowing

New home starts in 2013 will be down from the unusually high level
of last year. Household formation in Toronto is slowing from an average annual rate of 37,000 in the inter- censal period between 2006 and 2011, and at 34,000, total housing starts in 2013 will roughly match household formation.

The decline in starts will occur across all housing types. Most of the decline will occur among apartment starts. Sales of new condominium apartments slowed in the second half of 2012 and continued to ease in 2013.The slowing meant that not only were there fewer apartments to build, but also that it took longer for the projects to move from sales launch to the beginning of construction. A relatively large number of projects have sold a sufficiently high percentage of units to permit construction to begin, setting the potential for a high number of starts in the fourth quarter. However, apartment starts will continue to be restrained by the high number already under construction. Looking to 2014, apartment starts will ease somewhat from the 2013 level. The relatively high number of projects that began selling during 2011 but still have to lay foundations will limit the decline. Completions will exceed starts through most of the year implying the number of units under construction will decline as the year progresses, freeing up resources to allow new projects to start.

Although most units continue to be sold by the time projects reach completion, slower sales have led to a rise in the number of unsold units at all phases of development, according to Urbanation.As a result, asking prices for new units have flattened and prices at project launch have declined from a year ago. Given the price adjustment, sales are expected to pick up in the fourth quarter and into 2014.

Urs Villiger, Real Estate Agent

 

Were you betting on a Toronto real estate crash?

If we had any doubt about how the rest of the year was going to play out,  we have to acknowledge the situation is quite clear now: Toronto real estate is pushing up. Stronger than expected!

There are a reported 7,411 residential sales through the TorontoMLS system in September 2013, a 30% increase compared to 5,687 transactions in September 2012. Jan - Sep 2013, total residential sales amounted to 68,907 – down by one per cent compared to the same period in 2012.

“It’s great news that households have found that the costs of home ownership, including mortgage payments, remain affordable. This is why the third quarter was characterized by renewed growth in home sales in the GTA. We expect to see sales up for the remainder of 2013, as the pent-up demand that resulted from stricter mortgage lending guidelines continues to be satisfied,” said Toronto Real Estate Board President Dianne Usher.

The average selling price for September transactions was $533,797 – up by 6.5 per cent year-over-year. Through the first three quarters of 2013, the average selling price was $520,118 – up by over four per cent compared to the first nine months of 2012.

Main price driver is once again the single family detached sector with price increases of over 10% in the city in average. On the other hand, the condominium market seems to have cooled down a little, with plenty of options to choose from.

   

For your Toronto real estate needs, contact Urs Villiger, Real Estate Sales .

Toronto Condo Resale Market Statistics

With 5,984 condominium resale transactions through MLS in the second quarter of 2013, we are down by approximately 6% in comparison to the second quarter of 2012. The number of active listings at the end of the second quarter was up year-over-year by less than 2.5%, while new listings were down by slightly more than 4%. 

The average selling price for condominium apartments in the second quarter was $347,896 – up by 1.7 per cent compared to the average of $342,148 in the second quarter of 2012. 

“While active listings were up year-over-year in the second quarter, it is interesting to note that new listings were down over the same period. If the number of new listings continues to drop in the second half of 2013 and the sales situation improves, we could see the pace of condo price growth accelerate as market conditions tighten,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. 

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Toronto Real Estate Market Figures Indicate Further Price Growth

I don’t know about you, but in my neighbourhood, there are a couple of homes that have been on the market for a while now. Is it that the sellers are asking for too much? 

Or are there simply no buyers for these properties?

Is it the start of a downturn of Toronto real estate?

The overall numbers suggest, no. The number of sales transactions in June was on the same level like 2012. At the same time there are fewer new listings, indicating market conditions became tighter. 

"As a growing number of home buyers, many of whom put their purchase on hold due to stricter lending guidelines, now reactivate their search, the expectation is for renewed growth in home sales in the second half of 2013," says TREB president Ms. Usher. 

The average selling price in June was up by 4.7% year-over-year to $531,374. Price growth once more was driven by the single-detached and semi-detached market segments, particularly in the City of Toronto. Over the same time period, average condominium apartment selling prices remained in line with 2012 levels. 

"The short supply of low-rise home types in many parts of the GTA relative to the number of households looking to buy continued to prompt strong upward pressure on selling prices of singles and semis," said Jason Mercer, TREB's Senior Manager of Market Analysis. "We have also seen enough buyers in the better-supplied condo market to provide support for selling prices at current levels." 

Urs Villiger Toronto Real Estate Agent