February’s Resale Housing Market Recap
By: Tim Syrianos
Greater Toronto Area REALTORS® reported 5,175 residential transactions through TREB’s MLS® System in February 2018. This result was down 34.9 percent compared to the record 7,955 sales reported in February 2017.
The number of new listings entered into TREB’s MLS® System totaled 10,520, a 7.3 per cent increase compared to the 9,801 new listings entered in February 2017. However, the level of new listings remained below the average for the month of February for the previous 10 years.
When TREB released its Outlook for 2018, the forecast anticipated a slow start to the year compared to the historically high sales count reported in the winter and early spring of 2017. Prospective home buyers are still coming to terms with the psychological impact of the Fair Housing Plan, and some have also had to revaluate their plans due to the new OFSI-mandated mortgage stress test guidelines and generally higher borrowing costs.
The MLS® Home Price Index Composite Benchmark was up by 3.2 per cent on a year-over-year basis for the TREB market area as a whole. This growth was driven by the apartment and townhouse market segments, with annual benchmark price increases of 18.8 per cent and 7.5 per cent respectively. Single-family detached and attached benchmark prices were down slightly compared to February 2017. The overall average selling price for February sales was down 12.4% year-over-year to $767,818. However, putting aside the price spike reported in the first quarter of 2017, it is important to note that February’s average price remained 12 per cent higher than the average reported for February 2016, which represents an annualized increase well above the rate of inflation for the past two years.
I asked Jason Mercer, TREB’s Director of Market Analysis to provide further analysis on the latest market numbers.
“As we move further into the spring and summer months, growth in sales and selling prices is expected to pick up relative to last year. Expect stronger price growth to continue in the comparatively more affordable townhouse and condominium apartment segments. This being said, listings supply will likely remain below average in many neighbourhoods in the GTA, which, over the long-term, could further hamper affordability,”
In recent submissions to the City of Toronto and other levels of government, TREB has argued that housing affordability must continue to be a priority.
It is encouraging that the City did not include demand-oriented tax policies in its Budget. TREB believes that all levels of government need to collaboratively develop solutions to increase the supply of housing, especially the ‘missing middle’. This was noted in our 2018 Market Year in Review and Outlook Report, which calls for more ‘gentle density’, including housing types like semi-detached houses, townhouses, multiplexes and apartments.
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Courtesy of the Toronto Real Estate Board. TREB Wire http://ift.tt/2pejDXA
