The average price of a condo in the Greater Toronto Area rose 11.1% to a record price of $617,658, according to the Toronto Real Estate Board Housing (TREB).
Owning a home in Toronto is already out of reach for most ordinary people and the latest prices make the homebuyers dream even more far fetched. Detached home sales — the most expensive segment of the market — rose 23.8 % from a year ago, with the average price climbing 3.5 % to $1.04 million.
The tighter market conditions and accelerating price growth resulted from the continued drop in the supply of available housing listings.
There were a total of 7,090 residential sales through TREB’s MLS System last month, representing a 14.2% increase compared to November 2018.
Sales were up year-over-year for all major market segments in the GTA. The benchmark home sale price increased by 6.8% year-over-year and the average selling price increased by 7.1% to $843,637, compared to $787,349 in the same period last year.
However, new listings were down 17.9% year-over-year with York Region seeing the biggest decline in new listings, down 25% from last year.
TREB said “strong population growth coupled with declining mortgage rates” helped accelerate price growth and competition between buyers in November and throughout the second half of 2019.
Buyers back after policies cooled demand
According to TREB CEO John DiMichele, an increasing number of home buyers impacted by demand-side policies over the past three years, including the 2017 Ontario Fair Housing Plan and the OSFI mortgage stress test, have moved back into the market for ownership housing.
“Based on affordability and stricter mortgage qualification standards, many buyers may have likely adjusted their preferences, changing the type and/or location of home they ultimately chose to purchase,” DiMichele said in the board’s press release.
Last month we reported that affordability is the most important factor for many Canadians when it comes to buying a home.
A new survey commissioned by KPMG in Canada finds that millennials have proven to be willing to incur higher levels of debt to attain homeownership, they are less optimistic about the payoffs.
“Soaring house prices and rising personal debt are making it impossible for many millennials, even those with good-paying jobs, to ever afford a home,” KPMG said.
While 72% of millennials say their goal is to own a home, 46% say homeownership is a “pipedream”.
TREB expects “the rate of price growth to increase further if we see no relief on the listings supply front.”