The Toronto Real Estate Board (TREB) recently released its sales figures for the month of April and two items immediately stand out: (i) total GTA sales were down, a modest 3% from the previous year and (ii) for the second consecutive month, new listings were up (+33.6%), leading to a year-over-year rise in total active listings for the first time since July 2013.
To the first point, TREB acknowledges that there were additional holiday days this April when compared to 2016 which may have skewed the numbers slightly. Regarding the second, it’s worth noting that the 21,630 new listings represent the most new listings in an April since the new millennium. In fact, April 2010 was the only other April to exceed 20,000 new listings. This strongly suggests that homeowners are either ready to take advantage of high prices or feel that recent government intervention in the market may have some impact on the future value of their asset.
It’s too early to determine whether or not Ontario’s new Fair Housing Plan had an impact on total sales. It’s also worth noting that despite any new market uncertainty, average sales prices were still up 24.5% in the GTA, real inflation, as measured by the Home Price Index Composite Benchmark, was up over 31.5%, and the average sale took only 9 days to complete (40% faster than in 2016).
So, despite the slight decrease in total sales and jump in new listings, it remains very much a seller’s market in the GTA. That said, for those looking for greater balance in the market and for a greater selection of product, this is positive news. Moving forward, should more new listings continue to come to market, expect prices to continue their rise; however, it would not be unreasonable to expect price inflation to start resembling something closer to historical norms. It will also be interesting to see if listing prices begin to more closely reflect the seller’s desired sales price. Last month, the average sale price in the City of Toronto exceeded the average listing price by 11%.
For more information on the market or the new Fair Housing Plan, please call me.