Saturday, January 11, 2020

GTA REALTORS Release December and Annual 2019 Stats

Toronto Real Estate Board President Michael Collins reported that December 2019 residential sales reported through TREB's MLS® System by Greater Toronto Area REALTORS® were up by 17.4 per cent year-over-year to 4,399. Total sales for calendar year 2019 amounted to 87,825 – up by 12.6 per cent compared to the decade low 78,015 sales reported in 2018. On an annual basis, 2019 sales were in line with the median annual sales result for the past decade.

"We certainly saw a recovery in sales activity in 2019, particularly in the second half of the year. As anticipated, many home buyers who were initially on the sidelines moved back into the market place starting in the spring. Buyer confidence was buoyed by a strong regional economy and declining contract mortgage rates over the course of the year," said Mr. Collins.

While sales were up in 2019, the number of new listings entered into TREB's MLS® System was down by 2.4 per cent year-over-year. For the past decade, annual new listings have been largely in a holding pattern between 150,000 and 160,000, despite the upward trend in home prices over the same period.

"Over the last ten years, TREB has been drawing attention to the housing supply issue in the GTA. Increasingly, policy makers, research groups of varying scope and other interested parties have acknowledged that the lack of a diverse supply of ownership and rental housing continues to hamper housing affordability in the GTA. Taking 2019 as an example, we experienced a strong sales increase up against a decline in supply. Tighter market conditions translated into accelerating price growth. Expect further acceleration in 2020 if there is no relief on the supply front," said Jason Mercer, TREB's Chief Market Analyst.

The MLS® Home Price Index Composite Benchmark was up by 7.3 per cent on a year-over-year basis in December 2019. From June 2019 onward, the annual growth rate in the MLS® HPI Composite Benchmark accelerated. The average selling price in December 2019 was $837,788 – up almost 12 per cent year-over-year. For calendar year 2019, the average selling price was $819,319 – up by four per cent compared to $787,856 in 2018.

Sunday, December 1, 2019

Tarion adds new protection for condo buyers

Condo buyers in Ontario will get greater protection following the announcement of new requirements by the province’s home warranty provider.

Tarion says the new measures will help educate and inform prospective homebuyers and will include the addition of new search tools on Tarion’s Ontario Builder Directory and a new detailed information sheet highlighting the potential risks of purchasing certain types of pre-construction condominiums.

“The purchase of a new home is often the most important one that many Ontarians will make,” said Tarion’s President and CEO Howard Bogach. “At Tarion, we’re doing our part to ensure that these purchases are guided by a thorough understanding of the risks, builder history, and status of a given project. The initiatives that we’re announcing today will contribute to a better informed purchasing process.”

The new mandatory disclosures will be effective from January 1, 2020, and will ensure that potential buyers are aware of several key risk factors including:
  • pre-construction condominiums come with the risk that they may never be completed;
  • early termination conditions that would allow a developer to cancel a project; 
  • information about the status of the development (e.g., formal zoning approval, relevant approval authority and date of commencement of construction);
  • information about any restrictions on the developer’s land title that may prevent the project from going forward; 
  • a purchaser has an initial 10 days under the Condominium Act, 1998 to cancel a sales agreement; and
  • the expected date when a purchaser can take occupancy.
The new information sheet will be required for all agreements of purchase and sale for units where the purchase agreement for the project or phase of the project is signed after January 1, 2020.

However, leasehold, common element and vacant land condominiums are excluded from the requirement.

Thursday, November 21, 2019

Tarion adds new protection for condo buyers

Condo buyers in Ontario will get greater protection following the announcement of new requirements by the province’s home warranty provider.
Tarion says the new measures will help educate and inform prospective homebuyers and will include the addition of new search tools on Tarion’s Ontario Builder Directory and a new detailed information sheet highlighting the potential risks of purchasing certain types of pre-construction condominiums.
“The purchase of a new home is often the most important one that many Ontarians will make,” said Tarion’s President and CEO Howard Bogach. “At Tarion, we’re doing our part to ensure that these purchases are guided by a thorough understanding of the risks, builder history, and status of a given project. The initiatives that we’re announcing today will contribute to a better informed purchasing process.”
The new mandatory disclosures will be effective from January 1, 2020, and will ensure that potential buyers are aware of several key risk factors including:
  • pre-construction condominiums come with the risk that they may never be completed;
  • early termination conditions that would allow a developer to cancel a project; 
  • information about the status of the development (e.g., formal zoning approval, relevant approval authority and date of commencement of construction);
  • information about any restrictions on the developer’s land title that may prevent the project from going forward; 
  • a purchaser has an initial 10 days under the Condominium Act, 1998 to cancel a sales agreement; and
  • the expected date when a purchaser can take occupancy.
The new information sheet will be required for all agreements of purchase and sale for units where the purchase agreement for the project or phase of the project is signed after January 1, 2020.
However, leasehold, common element and vacant land condominiums are excluded from the requirement.

Sunday, November 17, 2019

No signs of overheating in the GTA's new home market

The beginning of fall typically marks the start of a busy season for the new home market in the Greater Toronto Area, and 2019 was no different. 

According to the Building Industry and Land Development Association’s monthly new home market report, there were 3,061 new home sales across the GTA in September 2019, which is 73% higher than the same month a year ago. Altus Group, BILD’s trusted source for new home market intelligence, says this is 6% above the 10-year average. 

New condo sales increased 39% with 2,107 sales in September, which is 12% above the 10-year average, while new single-family home sales went up a whopping 283% year-over-year with 954 sales. While there were many single-family home sales, the total for the month was still 5% below the 10-year average, which actually isn’t that low considering August 2019 single-family sales were 39% below the 10-year average.  

“September provided additional evidence that the new home market in the GTA is recovering nicely from last year’s slump,” says Patricia Arsenault, Altus Group’s Executive Vice President, Data Solutions. “The degree of improvement in both new home sales and new project openings this year has been contained, however, and there are no signs of overheating in the market.”

August is usually slow because builders are planning openings for September and October. There were many new launches in September, bringing the new home inventory in the GTA up to 18,745 units. It’s good to see inventory increasing along with sales because the GTA is in need of more supply as more and more families choose to move to the region. 

“While new home sales and inventory have been increasing, the GTA continues to experience a significant housing supply crunch,” says David Wilkes, BILD President & CEO. “We must continue to focus on the supply side of the housing equation to address this generational challenge for the long term.”

The average price of a new single-family home in the GTA in September 2019 was $1,081,175, which is 3.4% lower than a year ago. Though the average price fell slightly, most families in the GTA still can’t afford a new home priced higher than $1 million. 

As the average price of a new single-family home continues to drop slowly, the average price of a new condo in the GTA has jumped once again, this time by 6.5%, hitting $841,159. If the price gap between single-family homes and condos continues to decrease, we may see some buyers deciding to save slightly longer in order to buy a single-family home instead of a condo.

Tuesday, August 13, 2019

GTA condo apartment sales up 3.2% in the second quarter

The market for condo apartments remained strong in the Greater Toronto Area in the second quarter.

Greater Toronto Realtors reported 7,038 sales of condo apartments through the Toronto Real Estate Board’s MLS in the three months, up 3.2% compared to a year earlier.

New listings for the sector were down 3.5% year-over-year to 11,110; and the average price gained 5.1% to $589,887, although in the City of Toronto (70% of transactions) the gain was  5.9% to $639,316.

“As has generally been the case in the region since the implementation of the Ontario Government’s Fair Housing Plan in 2017, the condo market segment has remained tight in comparison to other major housing types. However, from a price point perspective, condo apartments continue to offer prospective buyers a relatively affordable housing option when looking across the GTA,” said TREB president Michael Collins.

Rental market also tight

In the rental market, average rents for one-bedroom and two-bedroom apartments increased above the rate of inflation on a year-over-year basis in Q2 2019 as the market remained tight.

“However, we have seen an acceleration in the number of units listed for rent, which has provided renters with more choice in the market place and has coincided with a slower pace of average rent growth over the past year,” said Jason Mercer, TREB’s Chief Market Analyst.