The month of July saw strong year-over-year growth in both unit sales and the average selling price throughout the City of Toronto & the GTA. According to the Toronto Real Estate Board (TREB), sales were up by 10 per cent coming in at 9,198 units sold—the second highest July on record.
The average selling price for the month was $550,700 – up by 7.5 per cent compared to July 2013. Bare in mind, this average represents all housing types (condos, semi-detached, townhomes, detached etc). If we were to focus in on detached homes exclusively, that average figure would easily hover above the 1 million dollar mark.
Thus the strongest rate of price growth reported was in fact the detached housing segment in the City of Toronto, with a year-over-year change of 11 per cent.
Yes, you read that correctly, the selling price of a detached home in the central core of the city has jumped eleven percent from 1 year ago. The better-supplied condominium apartment segment experienced average price growth of a more humble 5.3 per cent for the GTA as a whole.
“Summary of Toronto MLS Sales and Average Price July 1-31”
|Sales||Average Price||New Listings||Sales||Average Price||New Listings|
|City of Toronto ("416")||3,315||$576,552||5,787||3,029||$535,153||5,321|
|Rest of GTA ("905")||5,883||$536,132||9,400||5,338||$499,310||8,719|
According to some pundits,
“Strong demand for ownership housing will underpin robust average price increases for the remainder of 2014. In fact, the pace of price growth that we have experienced over the past year will continue until growth in listings outpaces growth in sales for a sustained period of time.” — Jason Mercer, TREB’s Senior Manager of Market Analysis.
From a practitioner’s standpoint, we are witnessing a housing dynamic where the pace of demand far outstrips the available supply. Naturally, this phenomenon—going into its second year—has spurred on tremendous confidence on the part of sellers and crushing frustration on the part of buyers.
Is the current pace sustainable? There’s really no simple answer. We know that the supply/demand imbalance is the most obvious factor at play; that said, it is unlikely the only factor at play.
Shifts in the age demographics, changes in urban density, interest rate trajectories and other variables not easily seen are all coalescing simultaneously. Amidst such an environment it’s perhaps more prudent than before to choose your advisors wisely.
“Toronto MLS Sales & Average Price By Home Type July 1-31”
|Sales (416)||Sales (905)||Total||Average Price (416)||Average Price (905)||Total|
|Yr./Yr. % Change||7.8%||11.1%||10.3%||11.0%||7.3%||8.2%|
|Yr./Yr. % Change||0.0%||0.3%||0.2%||8.3%||8.3%||8.2%|
|Yr./Yr. % Change||8.3%||11.0%||10.3%||9.2%||6.2%||7.0%|
|Yr./Yr. % Change||13.4%||14.6%||13.8%||4.7%||7.3%||5.3%|