Welcome Home by Derek Tsang
Toronto house prices continue to grow steadily, and they hit a record high this May, according to a report by the Toronto Real Estate Board (TREB). Not even the cool and rainy weather managed to put the price rise on hold, as the average price reached $542,174 — a 5.4 per cent increase compared to 2012. The growth was especially fuelled by the tight low-rise segment, with the prices of semi-detached houses in the City of Toronto going up by almost 8 per cent. The average transaction price for detached houses increased by 5 per cent, to $676,797 in a year-over-year comparison. Even condos experienced slight price gains of 1.2 per cent in the City of Toronto and 0.9 per cent in the 905 region, reaching $372,768 and $293,398, respectively. Townhouses in the City of Toronto saw the slightest price growth of all segments. Their value rose only by 0.2 per cent, to $463,772.
Orange Clouds over Toronto by Andrew Rivett
TREB’s senior manager of market analysis, Jason Mercer, commented on the report:
The annual rate of price growth in May was not surprising given the competition that still exists between buyers, particularly for low-rise home types such as single-detached and semi-detached houses. We remain on track for a three-and-a-half per cent increase in the average selling price for 2013 as a whole.
The MLS® Home Price Index (HPI) Composite Benchmark — which provides an apple-to-apple analysis and neutralizes the influence of non-comparable home sales that would otherwise skew the average and median price by mixing different housing segments — was up by 2.8 per cent year over year.
While the prices keep rising, the TorontoMLS system reported a 3.4 per cent dip in the number of transactions recorded compared to May 2012, as the total sales fell to 10,182 from 10,544. The drop is largely caused by condos and townhouses, which saw the steepest fall. Condo sales in the City of Toronto decreased by 6.4 per cent, and they were down 16 per cent in the GTA. Even though these numbers do not seem too optimistic, note that this is the first time since August 2012 that the decrease in Toronto proper is not in double digits. Townhouse sales fell 18.3 per cent in the City of Toronto and 3 per cent in the 905 region. The detached houses segment showed moderate growth, though, as the number of transactions in Toronto proper went up by 3 per cent, to 1,475. In the GTA, detached sales rose by 0.9 per cent, to 3,731. When discussing the sales figures, it's important to add that the average days on the market was up year over year, as May 2013 included 23 working days compared to the 21 working days in May 2012.
Ann Hannah, TREB president, provides her explanation of the data:
The sales picture in the GTA has improved markedly over the past two months. While the number of transactions in April and May remained below last year’s levels, the rate of decline has been much smaller. A growing number of households who put their decision to purchase on hold as a result of stricter lending guidelines are starting to become active again in the ownership market.
Buildings on Ossington Street Toronto by Jason Baker
The number of new listings rose slightly, increasing to 19,216 from the 19,075 listings recorded in May 2012. Active listings increased by 10.8 per cent, to 22,677, creating at least some maneuvering space for future moderation in price growth, since new listings can't satisfy strong demand for homes at the moment.