Toronto, Ontario - August 6, 2019 – “MarketWatch”, the Toronto Real Estate Board’s monthly statistical update, was released today showing a very strong month for sales volume and, aside from the Detached home group, good-but-not-too-good growth in average prices. The strong figures are especially encouraging for July which is traditionally one of the year’s slower months for residential real estate sales as people turn their attention to water parks, beaches, cottage country…summer vacation in general.
Overall [e.g. All TREB areas and all residence types] 8,595 residential MLS® sales were reported by Toronto & GTA Realtors® on the month representing a 24.3% jump compared to last July…and last July was an 18.6% jump from July, 2017 at which time the market had softened considerably in the wake of unsustainable market conditions in the Spring of that year, particularly March and April which are generally considered the market’s peaks - the former for “The 905” regions surrounding Metro Toronto; the latter for the City itself.
Note that at the bottom of this post is a chart showing a breakdown of "Home Sales Volume by Price & Type" if you're interested.
The overall average selling price last month was $806,755, up 3.2% YoY. That average sale price is the lowest since March [$788,153 on 7,138 sales]. it should be noted. The high for this year actually came in May [$838,220 on 9,961 sales]. June’s totals, just for quick reference, were $831,737 on 8,849 sales. All figures herein are year-over-year comparisons, except where noted otherwise.
The number of Total Active Listings [TAL] dropped a significant 9.1%. While it’s normal for inventory to fall in the summer months [and winter, for that matter], that’s a big drop - particularly for a marketplace already having well-documented supply issues. “New Listings” were up 3.7% but, again, that includes properties being re-listed and, as such, is a less relevant indicator than the “Total Actives” figure, in our opinion.
Those sales and inventory figures give us an “Absorption Rate” [Total monthly sales/New listings] - an indication of how quickly the housing market is “absorbing” new inventory - of .597 [.502 twelve months earlier]. The “Indicated Forward Inventory” figure [Total Active Listings/monthly sales] was 2.09 months [2.83 last July]. That simply means that, based on how many homes were for sale, it would take 2.09 months to clear all the inventory if the rate of sales remained constant. That’s pretty snug inventory by historical standards…though “sky high” versus the Spring of ’17 when Forward Inventory cratered to a low of just a few weeks…and, naturally, prices were romping [obviously unsustainably] upward at over 30% YoY.
Specific Home Types
866 Detached homes were reported sold in Metropolitan Toronto, a 29.4% spike, at an average selling price of $1,227,301, down 9.1%. In “The 905” - the balance of the Greater Toronto Area - 3,075 Detached sales were reported, marginally bettering T.O.’s figure at +29.7%. Those sales averaged $929,633, up 2.5%. Clearly - at least for Detached homes - affordability levels are very much a factor, particularly when the “2x” Land Transfer Tax [LTT] applicable in Metro Toronto is factored in.
On the Condo Apartment front, 1,617 units were sold, up 14.8%, at an average of $627,92, up 7.7%. “The 905” saw 660 sales reported, up an even 13%, averaging $476,445, up 3.2%.
From the Report, released by Toronto Real Estate Board President Michael Collins: “Broadly speaking, increased competition between buyers for available properties has resulted in relatively strong price growth above the rate of inflation for semi-detached houses, townhouses and condominium apartments. However, the single-detached market segment, which has arguably been impacted most by the OSFI stress test, has experienced a slower pace of price growth, with average detached prices remaining lower than last year’s levels in some parts of the GTA.”
Homes sold more quickly on average this July versus last at 23 Days on Market compared to 25 DOM [“8% faster”].
Once again, thank-you for reading: We hope you’ll be back soon and, in the meantime, enjoy the beautiful weather!
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