“Ownership demand has been driven not only by low borrowing costs, but also by the fact that the GTA economy has been performing quite well, with the unemployment rate lower compared to last year,” Mark McLean, president of the Toronto Real Estate Board (TREB), told REP in a release. “Home buyers remain confident in the long-term benefits of owning a home.”
The recent numbers from TREB may give some cause for pause. Fears are excessive building and unsold units have made Toronto a riskier market than Vancouver, but analysts remain confident that the market is still on pace to set records this year. And there’s reason to be optimistic.
A recent report from TD Economics answered critics who believe that Toronto faces a medium-to-moderate chance of a deep crash instead of a soft landing. TD’s report suggests Canadian housing activity will cool later this year and in 2016, but stops short of suggesting a recession repeat in 2008.
Prices have been rising steadily between 6-6.5 per cent for the past three to five years despite concerns of overvaluation, which is hovering around 10 per cent according to the TD report.
The average price for a detached home in 416 neighbourhoods fell under $1 million, however the price increased 13.3 per cent year-over-year. Overall, including the 905, the average price for a detached home in the GTA is $787,607.
At the same time, the condo market has been taking off as TREB reported 2,429 sales were reported, a 14.4 per cent increase year-over-year. The average price for a condo is $372,263, a 4.1 per cent increase.
For all property types, there were a total of 9,880 sales at an average price of $609,236, compared to 9,152 sales for an average price of $550,625. What’s more, listings were down to 14,699 from 15,081.
"With the level of inventory in the GTA trending below two months, many listings continued to generate a lot of interest from buyers,” McLean said. “Not surprisingly, this supported further price increases well-above the rate of inflation. Assuming similar interest rate and economic environments over the next five months, strong price growth will remain the norm for the rest of 2015.”
The price for a detached home dropped below $1-million for the first time in months, a sign that the market could be cooling off; however, the Toronto Real Estate Board believes the market is still hot.