August was a slow month for the Greater Toronto Area’s new home market, but that’s normal for this time of year. On a year-over-year basis, activity increased for the new single-family home segment, but sales were still low considering historical levels.
In August 2019, there were 1,400 new home sales in the GTA, according to Altus Group, the Building Industry and Land Development Association’s trusted source for new home market intelligence. This is a 19% year-over-year increase, but is still 23% below the 10-year average.
There were 961 new condo sales, down 4% from the same month a year ago. This is also 12% below the 10-year average.
“August was the first month since March that new condo apartment sales didn’t exceed their 2018 level,” says Patricia Arsenault, Altus Group’s Executive Vice President, Data Solutions. “Typically very few new projects open in August and this year there were actually none – this played a role in the slightly lower number of new condo sales compared to August last year.” With zero new condo launches, new home inventory fell to 16,529 units across the GTA.
There were 439 new single-family home sales, which is a whopping 143% higher than a year ago, but still 39% below the 10-year average. “New single-family home sales outpaced year-earlier levels for the 10th month in a row in August,” says Arsenault. “But the level of sales remains low in historical terms, with affordability of available product an issue for many would-be buyers.”
The average price of a new single-family home fell 4.1% to $1,083,358, while new condos closed the price gap, jumping 7.2% to $840,799.
“It is encouraging to see sales of single-family homes increase as the market returns to more typical levels,” says BILD President & CEO David Wilkes. “However, we still have concerns that until fundamental adjustments are made to align supply with demand in the GTA housing market, we will continue to have affordability challenges.”
As we learned recently from a PwC and ULI survey, condo developers in Toronto are concerned about rising costs of land, materials, and construction, as well as delayed and lengthy approval processes.
It will be interesting to see how the GTA’s new home market wraps up 2019!