It appears home buyers are starting to warm back up to the market after a slower-than-typical autumn season. The Toronto Real Estate Board reports that sales saw an unusually strong surge between September and October – a sign the psychological barriers that had frightened buyers following the introduction of the Fair Housing Plan are starting to subside.
Sales rose 12 per cent month over month with 7,118 homes changing hands. While that’s still a 26.7-per-cent drop from last year’s activity, TREB President Tim Syrianos is optimistic demand is bouncing back.
“Every year, we generally see a jump in sales between September and October. 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 per cent year over year to $780,104.
Prices Rise Most for Condos and Townhouses
While the number of sales fell across all home types compared to last October, each segment experienced some recovery in activity from September’s lag.
Detached homes saw their biggest recovery since early spring – a trend identified in Zoocasa’s mid-month October report – with sales rising 13 per cent month over month, though still sharply below 2016 by 29.8 per cent. Compared to last year, prices are down 2.5 per cent to $1,008,207. Semi-detached home sales rose 9 per cent m-o-m, while 23.5 per cent under last year’s number. The average price rose 6.3 per cent year over year to $764,293.
The greatest price growth continues to be experienced by homes on the affordable end of the spectrum; townhome prices rose 7.4 per cent from 2016, to an average of $629,507, with sales down 22 per cent year over year. While sales of condos fell 25 per cent year over year they greatly outpaced all other home types in price growth, surging 21.8 per cent from last year to an average of $523,041. Month over month sales were up 13 per cent and 9 per cent, respectively.
Following Vancouver Market’s Footsteps?
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 buyers 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 stated. “Similar to the track followed in the Greater Vancouver Area, it appears that the psychological impact of the Fair Housing Plan, 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 collected data on the impact of such rules which include the OFHP, new mortgage guidelines, as well as a potential vacant homes tax in Toronto.