With the spring market in full swing, competition for real estate in the Greater Toronto Area (GTA) is heating up as a consistently low number of listings leaves would-be buyers with few options.
Sales were on the up-and-up in April, reaching 7,531, according to new data from the Toronto Regional Real Estate Board (TRREB). This marks a rather significant 9.2% jump from March sales but, notably, is a 5.2% drop from the sales seen in April of last year.
At the same time, the number of new listings in the GTA has remained relatively flat, far from keeping pace with the jump in sales. With a grand total of 11,364 new listings in April, this marks a 1.6% increase over March, and a 38.3% decline on an annual basis.
“Many buyers have come to terms with higher borrowing costs and are taking advantage of lower selling prices compared to this time last year,” said TRREB President Paul Baron. "The issue moving forward will not be the demand for ownership housing, but rather the ability to meet this demand with adequate supply. This is a policy issue that requires sustained effort from all levels of government."
Those lower selling prices, however, are changing. With fewer listings and more buyers, market conditions are unsurprisingly tight, helping to push prices up. The average selling price in April all across the GTA hit $1,153,269 -- a slight, but not negligible, 4% increase from just one month prior.
“As demand for ownership housing has picked up relative to supply, we are seeing renewed upward pressure on home prices," said TRREB Chief Market Analyst Jason Mercer. "For a short period of time, higher borrowing costs trumped the impact of the constrained housing supply in the GTA. Renewed competition between buyers is once again shining the spotlight on the persistent lack of listings and resulting impact on affordability."
Price increases were seen across all housing types, but the biggest change was found in townhomes, where a 5.5% month-over-month increase brought the new average price to $986,121. It was followed by semi-detached homes with a 4.4% jump to $1,135,599, condos with a 2.8% jump to $724,118, and detached homes with a 1.4% jump to $1,489,258.
“Lack of affordability in the GTA ownership and rental housing markets has been well-documented,” said TRREB CEO John DiMichele. "On top of this, households faced with steep price increases for basic goods and services have had to make tough decisions to adapt."
It's time for the government to make tough choices, DiMichele says, and "provide more value for every tax dollar they collect" while looking for ways to reduce tax burdens moving forward.