August was a remarkably slow month for new home sales in the Greater Toronto Area (GTA), the Building Industry and Land Development Association (BILD) reported on Thursday.
There were 711 new home sales recorded in the month according to Altus Group, BILD’s official source for new home market intelligence. While that figure was up 52% year over year, it was 63% below the 10-year average and marked the second-quietest August for new home sales on record.
Edward Jegg, Research Manager at Altus Group, points out that August has historically been a slow month for homebuying. Still, he says, “the return of the interest rate hikes further dampened GTA new homes sales.”
With rates hitting a 22-year high, many buyers were simply not in good purchasing shape this summer, adds Justin Sherwood, Senior Vice President for BILD.
Condominium apartments (including units in low, medium and high-rise buildings, stacked townhouses, and loft units), made up the bulk of total sales, with 443 units sold. That number came in at a 15% decrease year over year and was 66% below the 10-year average.
In the single-family segment (including detached, linked, and semi-detached houses, as well as townhouses) 268 sales were recorded last month. That figure was up 227% from August 2022, but was 56% under the 10-year average.
Though they accounted for less than half of total sales in August, Sherwood says that single-family home sales were “relatively strong” and underlines the need for municipalities to build “a mix of housing types” to satiate the housing need of families.
BILD also said on Thursday that the total new home remaining inventory in the GTA edged down slightly from July to 16,139 units. Breaking that figure down, it includes 14,242 condominium apartment units and 1,897 single-family lots, representing 13.7 months and 4.5 months of inventory respectively, based on average sales for the last 12 months. (A balanced market has around nine to 12 months of inventory.)
The remaining inventory includes units in pre-construction projects, projects currently under construction, and completed buildings, BILD also noted.
As well, the benchmark price for new condominium apartments was $1,089,012 in August. For single-family homes, the benchmark came in at $1,726,092. Over the last 12 months, prices in those segments have slipped 8.5% and 7.3%, respectively.