TORONTO – Home sales in the Greater Toronto Area hit a record last month as fewer homeowners put their properties up for sale, the city’s real estate board said Wednesday.
The Toronto Real Estate Board said its members had 9,813 sales in August, a 23.5 per cent increase from the same month last year, though there were two more working days this year.
Still, even adjusting for an equal number of days, last month’s sales volume in the GTA was up about 13 per cent from August 2015.
Jason Mercer, the director of market analysis at TREB, says dwindling inventory has been one of the main reasons why prices for single-family homes have been soaring in Toronto over the past year.
“If you’re looking to purchase a single or a semi or a townhome, it’s really difficult in a lot of neighbourhoods to find a home that meets your needs,” said Mercer.
“Whenever you have a situation like that, you’re going to have strong upward pressure on prices.”
The average price for homes sold, regardless of type of property, was $710,410, an increase of 17.7 per cent. Detached homes in the city of Toronto proper cost on average $1.2 million, up 18.3 per cent.
The data comes amid concerns that Vancouver’s new 15 per cent tax on foreign buyers could send investors to Toronto, driving up prices in a market that’s already scorching.
But experts say it’s too soon to tell whether Vancouver’s tax, which was introduced on Aug. 2, is having any impact on Toronto’s real estate market.
“I think it’s definitely too soon to jump to a conclusion because we don’t have the numbers on what foreign ownership is like,” said Shawn Zigelstein, a Toronto-based realtor with Royal LePage Your Community Realty.
Zigelstein says three or four months’ worth of sales figures and data on the rate of foreign ownership are needed before the impact of the new tax can be discerned.
Ontario Premier Kathleen Wynne and Toronto Mayor John Tory both emphasized the importance of taking a wait-and-see approach before intervening in Toronto’s real estate market.
“Either me or the provincial government could step up and do something to try and earn political points by having people think we’ve done something to increase affordability of housing in Toronto,” Tory said during a news conference Wednesday.
“I just want to make sure that anything we do is actually going to have a real, positive impact that isn’t going to be about show business and politics. People want real solutions, not solutions that make them feel better for 20 minutes.”
The real estate market is “very complicated,” he added.
“I think anybody who thinks they have an easy answer is fooling the public and fooling themselves.”
Wynne said the provincial government is working with the city and the federal government to address eroding affordability as part of a national housing strategy. But, she added, it’s still early days.
“I would be very cautious in terms of moving forward on any changes or interventions into that market,” Wynne said.
“It’s a different market than British Columbia’s in the GTA. So we’re looking at it, we’re working with the city and the federal government, but there have been no decisions made.”
In Vancouver, sales dropped 26 per cent in August – the first month following the introduction of the tax – compared to a year ago, although prices continued to rise. The benchmark price for all residential properties in Vancouver climbed 31.4 per cent from a year ago to $933,100.