New home market quiet in August

September 26, 2018

Greater Toronto, Sept. 26, 2018 – It was a quiet month for the GTA new home market in August, as buyers waited on the sidelines, the Building Industry and Land Development Association (BILD) reported today.

There were 974 total new home sales in August, according to Altus Group*, BILD’s official source for new home market intelligence. Single-family home sales, with 171 detached, linked and semi-detached houses and townhouses (excluding stacked townhouses) sold, were up 50 per cent from last August but down 80 per cent from the 10-year average. Condominium apartments in low, medium and high-rise buildings, stacked townhouses and loft units accounted for 803 new home sales, down 1 per cent from August 2017 and down 28 per cent from the 10-year average.

August’s sales numbers should not be interpreted as a sign that there is a shortage of interested buyers in the GTA, according to Patricia Arsenault, Altus Group’s Executive Vice-President, Data Solutions. “Pent-up demand is forming, which suggests we should see sales start to firm up this fall,” she said.

Many potential new home buyers are taking a wait-and-see approach due to the effects of government interventions to cool the housing market and concerns about the future direction of the economy, according to David Wilkes, BILD President & CEO. “Once the market adjusts and more people start looking for homes, our region’s short supply of housing will mean that affordability will continue to be a challenge for many new home buyers,” he said.

In August, the benchmark price of new condominium apartments rose to $784,512, up 21.8 per cent over the last 12 months. The benchmark price of new single-family homes was $1,129,129, down 12.4 per cent over the last year.

With only two projects opening in August, the remaining new home inventory decreased to 13,619 units, comprised of 8,842 condo apartment units and 4,777 single-family units. Remaining inventory includes units in preconstruction projects, in projects currently under construction, and in completed buildings.

Mr. Wilkes said that to truly solve the challenges facing the GTA housing market, governments need to address the supply side of the equation. “Municipal governments, in particular, can make a big difference,” he said. “Ahead of the municipal elections in the GTA, BILD has been talking to municipal leaders and residents about straightforward steps that municipalities can take to increase housing supply, including making sure that government charges on new homes are fair, funding and building critical infrastructure, cutting red tape and speeding up building permits and inspections. Voters can find out more and send an email to their local candidates at www.buildforgrowth.ca.”

August New Home Sales by Municipality**:

August 2018

Condominium Apartments

Single-family

Total

Region

2018

2017

2016

2018

2017

2016

2018

2017

2016

Durham

10

25

73

32

46

198

42

71

271

Halton

33

28

148

34

10

65

67

38

213

Peel

124

96

153

56

31

81

180

127

234

Toronto

521

610

1,423

7

5

18

528

615

1,441

York

115

53

175

42

22

116

157

75

291

GTA

803

812

1,972

171

114

478

974

926

2,450

 

Source: Altus Group

*Altus Group should be credited as BILD’s official source of new home market intelligence.

**Historical data are subject to revisions.