The Building Industry and Land Development Association released its new home sales figures for January 2019, reporting that the Greater Toronto Area’s new home market is off to a good start this year!
There were 1,362 new home sales in the GTA in January 2019, which is 14% higher than January 2018, according to Altus Group, BILD’s trusted source for new home market intelligence.
That said, only 420 of those sales were of new single-family homes, which is 53% lower than the 10-year average. That leaves 942 new condo sales last month, and that’s pretty in line with the long-term average (just 5% lower).
“This year is starting off on a positive note,” says Patricia Arsenault, Altus Group’s Executive Vice President, Data Solutions. “The improvement in new home sales over last January is consistent with our outlook for somewhat higher annual sales in the GTA this year, following the drop in 2018.”
The average price of a new single-family home fell 8.1% year-over-year to $1,130,046. Despite this drop, the average buyer will likely still have a difficult time affording a $1 million+ home in the GTA. The average price of a new condo spiked by 12.5% year-over-year, bringing the average up to $803,638. It’s clear that what was once considered the most affordable housing type in the GTA is also climbing out of reach of some buyers.
It’s interesting to see how new condo price growth continues to gain momentum. Even though prices are rising, new condos remain relatively affordable compared to single-family homes. The keyword is “relatively.” In 2018, single-family home price growth took a hit, but new condo prices just kept on climbing. As long as single-family homes average more than $1 million, buyers will be turning to condos (unless condo units approach $1 million on average, which actually doesn’t seem out of the question).
Compared to December 2018, there were fewer new openings and releases last month, so inventory fell slightly. As of the end of January 2019, there were 15,530 new homes available in the GTA, with 10,364 units being condos and the remaining 5,166 single-family homes.
“It looks like the market is starting to return to typical levels after a particularly difficult year,” says David Wilkes, BILD President & CEO. “With the spring budget coming up, we are calling on the federal government to take steps to make it easier for first-time homebuyers to get into the housing market.”