As housing markets all across the GTA continue to slow, new home sales are now down 40% from the same time last year.
According to a new report from the Building Industry and Land Development Association (BILD), May saw new home sales dip to 2,549, sitting 26% below the 10-year average. It's also noticeably lower than the 3,645 sales seen in April.
The majority of May's sales were condominium apartments, accounting for 2,058 of the total home sales. This is 31% lower than new condo sales in May 2021 and 10% lower than the 10-year average. Single-family homes, including detached, semi-detached, linked, and townhouses, made up 491 of the new homes sold-- a staggering 62% drop year-over-year and 58% below the 10-year average.
“GTA new homes sales eased in May as consumers deal with rising mortgage rates and growing economic concerns,” said Edward Jegg, research manager at Altus Group, BILD’s official source for new home market intelligence. “Inventory levels are moving higher but benchmark prices are showing resiliency.”
But even as sales fell, prices are still up year over year. The benchmark price for a new condo apartment in May sat at $1,176,080 -- up 10.5% from the same time last year. For single-family homes, the benchmark price came to $1,814,774, marking a 31.5% annual increase.
Inventory levels -- something markets all across the GTA struggled with during the pandemic but have seen some easing as of late -- are also on the rise. The number of total new home listings rose from the levels seen in April to a total of 10,004. Of these, 8,050 were condo apartments and 1,954 were single-family homes. Although this is a good sign for further easing of market conditions, BILD President and CEO Dave Wilkes warns that it may not stick around if there isn't a sustained effort to creating more housing.
“While short term macro-economic trends point to an easing of housing demand in the coming months, failure to plan to ensure a consistent pipeline of new housing of all types will result in a future resurgence of the tight market conditions of the last few years,” Wilkes said. “This was the pattern following the 2017 market correction and the introduction of the mortgage stress test. Given present projected population growth, it is prudent for governments and industry to use this time to collectively plan for another period of renewed demand.”
