The Toronto Real Estate Board (TREB) released its monthly resale housing market figures for April 2018, announcing a drop in sales, average selling price, and listings.
There were 7,792 sales reported through the MLS system last month, which is a year-over-year dip of 32.1%. The decrease in sales was seen across all housing types. The largest was in the detached market, which fell 38.4%.
The fewer sales corresponds with the fewer listings. In April, 16,273 listings hit the market. Last year at the same time, there were 21,571 listings.
“The comparison of this year’s sales and price figures to last year’s record peak masks the fact that market conditions should support moderate increases in home prices as we move through the second half of the year, particularly for condominium apartments and higher density low-rise home types,” says Jason Mercer, TREB’s Director of Market Analysis.
“Once we are past the current policy-based volatility, homeowners should expect to see the resumption of a moderate and sustained pace of price growth in line with a strong local economy and steady population growth,” Mercer explains.
Think of 2017 as a tidal wave and 2018 as a calm surface.
The average selling price fell 12.4% to $804,584. In addition to recent government policy, TREB attributes the decreasing average selling price to the fact that people are buying smaller and more affordable homes. Detached sales over $2 million only accounted for 5.5% of detached sales in April 2018. In 2017, 10% of the detached sales were more than $2 million.
The average selling price of a detached home decreased 14.4%, but remained just above $1 million. Condo units were the only market segment that saw an increase in average selling price, jumping 3.2% to $559,343.
“While average selling prices have not climbed back to last year’s record peak, April’s price level represents a substantial gain over the past decade,” says TREB President, Tim Syrianos. “Recent polling conducted for TREB by Ipsos tells us that the great majority of buyers are purchasing a home within which to live. This means these buyers are treating homeownership as a long-term investment. A strong and diverse labour market and continued population growth based on immigration should continue to underpin long-term home price appreciation.”
With the provincial election coming up, TREB has stressed that housing should be made a priority for all major parties.
“In recent months and years, there has been significant intervention in housing markets by all levels of government, through regulatory changes and taxation,” says Syrianos. “We believe the next step should be tax relief, especially from Land Transfer Taxes, both provincial and the Toronto Land Transfer Tax, and efforts to facilitate an increase in the supply of missing middle housing that fills the gap between single-family homes and high-rises.”
“Furthermore, we believe that any attempt to increase the Toronto Land Transfer Tax should require approval from the provincial government, given the significance of Toronto’s economy to the Province and the connections between the Toronto real estate market and that of the broader GTA,” he adds.
What do you think? Would the party lowering land transfer taxes win your vote?