September 18, 2013
The Toronto Real Estate Board reported 3,158 transactions through its MLS system for the first 14 days of September 2013.
This represents a spike of 29 per cent compared to September of 2012 as sales were up across all the major housing types on a year-over-year basis. The condominium apartment segment led the way with stronger sales growth in the City of Toronto.
It’s worth noting that the number of new listings entered into the TorontoMLS system were down slightly, compared to the same period last year.
We are seeing slight inventory tightening in some market segments, leading to inevitable increased competition among buyers.
The average selling price for mid-month September was up by four per cent on an annual basis, sitting at $514,560.
“With months of inventory remaining low from a historic perspective and evidence of tighter market conditions during the summer, the only argument that makes sense is for continued home price growth in the Greater Toronto Area for the remainder of 2013,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
I do agree, Mr. Mercer has a point: a tight supply dynamic logically translates into upward price momentum. However, I feel strongly that a gradual increase over time is far more preferable than a spike spurred on by current inventory tightening.
Let’s not forget that the most important gauge of a sustainable market is in fact affordability. The erosion of affordability against the backdrop of static economic growth is not the scenario we want to see play out, irrespective of the much coveted above-inflation price growth.
Summary of TorontoMLS Sales and Average Price September 1-14
|Sales||Average Price||New Listings||Sales||Average Price||New Listings|
|City of Toronto||1,151||$531,388||3,021||869||$534,782||3,282|
|Rest of GTA||2,007||$504,909||4,553||1,581||$473,031||4,450|
TorontoMLS Sales & Average Price by Home Type September 1-14, 2013