February 27 - New home sales slump continues in January

February 27, 2009

New home sales slump continues in January

Toronto, On- With just 599 new homes and condominiums sold across the Greater Toronto Area in January, 2009, the sharp downward trend exhibited during the last quarter of 2008 has continued into the New Year.

New home sales were down 69 per cent in January compared with the same month the previous year. A review of the records reveals that January sales have only been less than 599 units once (in 1992 - 513 units) since the database was established in 1981.

"The very slow start to the New Year did not come as a surprise given the obvious trend-line and the macro-economic forces at play," said BILD President and CEO Stephen Dupuis, "but that doesn't mean we're not concerned about it.

"During January, buyers had yet to see the U.S. and Canadian responses to the global economic crisis. The spring housing market will be unfolding in the context of the new Obama administration in the U.S. and the massive fiscal stimulus packages unleashed on either side of the border and time will tell how homebuyers respond to these developments," Dupuis added.

Mr. Dupuis expressed cautious optimism that the federal stimulus package combined with further enticements expected in the pending provincial budget together with the boost from 50-year low interest rates will have a positive impact on the market so long as the measures are not undermined by contradictory government policies that would increase the cost of doing business.

Dupuis cited the provincial government's recent imposition of mandatory WSIB coverage as an example of an ill-timed initiative and warned that harmonization of the GST and PST would devastate the already moribund housing sector. "There's no point in putting the gas pedal to the metal from a stimulus standpoint while braking equally hard with the other foot, but that's what harmonization amounts to," he said.

As an example of a more enlightened approach, Dupuis complimented Toronto Mayor David Miller and City Council on their decision to hold off any development charges increases for two years or more depending on the health of the industry. "The truth is that we need rollbacks in development charges, but the City of Toronto nevertheless deserves credit for deferring the increases to protect and promote jobs and investment in the City," Dupuis concluded.

January

Low Rise 

 

High Rise

 

Total

 

Region

2008

2009

% Change

2008

2009

% Change

2008

2009

%Change

Durham

181

117

-35.4%

13

2

-84.6%

194

119

-38.7%

Halton

283

69

-75.6%

2

6

200.0%

285

75

-73.7%

Peel

219

84

-61.6%

82

15

-81.7%

301

99

-67.1%

Toronto

69

21

-69.6%

508

184

-63.8%

577

205

-64.5%

York

455

90

-80.2%

109

11

-89.9%

564

101

-82.1%

GTA

1,207

381

-68.4%

714

218

-69.5%

1,921

599

-68.8%

Source:  RealNet Canada Inc.
With more than 1,400 members, BILD, formed through the merger of the Greater Toronto Home Builders' Association and Urban Development Institute/Ontario is the voice of the land development, home building and professional renovation industry in the Greater Toronto Area.  BILD is proudly affiliated with the Ontario and Canadian Home Builders' Associations.