It has been a slow start to 2018 as buyers and sellers adjust to new lending guidelines which took effect in the New Year. The 4,019 total sales represent a 22% drop from last January, while the 8,585 new listings were up 17.4% over the same time period. Both represent the ninth lowest total in their category over the past decade.
The average sales price of $736,783 is down 4.1% year-over-year, due in part to a decline in the sales of single-detached homes, -26% year-over- year. Although sales fell for all major housing categories, single detached was the only sector with a lower average sales price in the 416, down 3.9% in Toronto and 9.1% across the GTA year-over-year.The MLS Home Price Index (HPI) Composite Benchmark shows the value of detached homes virtually unchanged from last January (+0.25%).This suggests the drop in the average sales price for detached homes is due to a decline in the total sales of more expensive residences.
Though sales of condominium apartments also fell year-over-year (-22%), the average price of condos was up 14.6% from last January. The HPI for condo apartments was up 20%, suggesting that buyers are purchasing more modestly priced units. It is likely investors are playing some role in the acquisition of smaller condos. At the end of 2017, rental vacancy in the condo market was 0.7%, while inflation for one-bedroom apartments was at 10.9%.
The Toronto Real Estate Board’s forecast for 2018 predicts a slow start for 2018 as the impact of Ontario’s Fair Housing Plan wanes, and the market adjusts to the new OSFI mandated stress tests for mortgage approvals. At their recent Economic Summit, TREB economists pointed to strong fundamentals (high immigration, low unemployment) as drivers of demand, but conceded that affordability would continue to impact many people, particularly the first-time buyer.