We’re a few weeks over the halfway point of 2019, and it’s official, the Greater Toronto Area’s resale condo market is still tight.
According to the Toronto Real Estate Board, there were 7,038 condo sales reported through the MLS in the second quarter of 2019, which is a year-over-year increase of 3.2%. As sales increased, new listings fell 3.5% with 11,110 units hitting the market, compared to 11,512 in the same quarter last year.
“As has generally been the case in the region since the implementation of the Ontario Government’s Fair Housing Plan in 2017, the condo market segment has remained tight in comparison to other major housing types,” says TREB President Michael Collins. “However, from a price point perspective, condo apartments continue to offer prospective buyers a relatively affordable housing option when looking across the GTA.”
The interesting thing is that while the City of Toronto accounted for 70% of the condo transactions, it was actually the only area of the GTA to see a year-over-year drop in sales. In the second quarter of 2018, there were 4,894 condo sales in Toronto, and this year, there were 4,836 sales in the second quarter.
Looking at the other regions in the GTA, including Halton, Peel, York, and Durham, condo sales were up on a year-over-year basis across the board. The greatest increase in sales was in Peel, where there were 890 condo sales in the second quarter of 2018 compared to 1,076 in 2019. Peel also had the strongest price growth, increasing from an average price of $419,396 to $461,771.
The overall average price of a resale condo in the GTA went up 5.1% in the second quarter of 2019, hitting $589,887. The average price went up 5.9% in Toronto to $639,316, making it the most expensive region in the GTA. The most affordable region was Durham where the average condo sold for $416,053.
In the first half of the year, the Canada Mortgage and Housing Corporation reported a decline in condo completions, which TREB is linking to fewer listings. As condos reach the point of completion, investors sometimes list them before the time of closing (called an assignment sale). So, with fewer condos nearing completion, there were probably fewer investors looking to sell during this time period.
If listings were down because of completions, it’s fair to assume that the rental market was somewhat impacted by fewer condos reaching completion. You’d think that’d be the case, but TREB actually noticed a slight increase in rental listings. It could be the high prices in the condo market are forcing more prospective buyers to rent.
“The condominium apartment rental market also remained quite tight in the second quarter, with average rents for one-bedroom and two-bedroom apartments increasing above the rate of inflation on a year-over-year basis,” says Jason Mercer, TREB’s Chief Market Analyst. “However, we have seen an acceleration in the number of units listed for rent, which has provided renters with more choice in the market place and has coincided with a slower pace of average rent growth over the past year.”
We’re excited to see how the GTA’s resale condo market performs through the second half of 2019!