There doesn’t appear to be an end in sight when it comes to escalating home and condo prices in Toronto and the GTA. Recent figures released by the Toronto Real Estate Board paint a picture of a spring real estate market ripe with action, with new potential homebuyers entering the market, and fewer and fewer homes available for purchase.
The Toronto Real Estate Board reported that 8,940 homes were sold in March, up from 8,081 sales in March 2014. Susan Pigg of The Toronto Star notes that the average sale price of houses and condos combined across the GTA reached $613,933, up 10% from the average of $557,684 in March of 2014. In keeping with the big news from February’s real estate market analysis, detached homes in the GTA have eclipsed the $1 million mark, selling for an average of $1,042,405, an increase of 15.9% from March of last year. Garry Marr of The Financial Post, after taking a look at the figures himself, officially declared Toronto a seller’s market.
Many market analysts point out that Toronto’s prices increases are notable, considering the rest of the country appears to be slowing down, with the exception of Vancouver. A recent housing market scorecard, released by BMO, identified half of Canada’s housing markets as being “weak” or “very weak.” Calgary, Edmonton, Ottawa, and Montreal, all fell within the “weak” column.
The consensus of analysts and reporters appears to be that demand has never been higher, with many new prospective buyers entering the market this spring. And in a market that is already strapped for available listings, bidding wars for Toronto homes drive prices up considerably.
TREB president Paul Etherington was quoted by saying:
“A substantial amount of pent-up demand remains in place, especially as it relates to low-rise market segments. This suggests that strong competition between buyers, which has fuelled strong price growth so far this year, will continue to be experienced throughout the spring.”
Carolyn Ireland of The Globe and Mail, after speaking with a couple of local real estate agents, makes a compelling argument as to why the demand for homes tends to surge in the Spring. Families with school-aged kids typically begin to plan their buying and selling strategies during this time of year, in the hopes that the move will coincide with the end of the school year.
The TREB figures support the idea that there is a shortage of listings to go along with increased demand, which further elevates prices. The number of new listings available went up 5.5% in March compared to a year ago, but sales went up 11% in the same time frame. Twice as many homes are being purchased over new homes that enter the market.