Toronto Market Update for August 2019

11 September 2019
Life and the City

Last month in August, the Toronto market saw a surge in sales and a drop in inventory, leading to the largest price growth in 18 months. There was a flurry of activity at a time of year when the market typically slows down, and data shows that there were improvements for most sales numbers in August, year-over-year.

Across the GTA, we're seeing that the price of a home is gradually increasing and approaching an all-time high. According to the Toronto Real Estate Board (TREB), the composite benchmark (the price of a typical home) in August reached $802,400 in the GTA, up 4.92% from last year, and pushed even higher in the City of Toronto as it reached $887,800, up 5.9% year-over-year. The condo segment has been the primary driver of this price growth across all areas.

The annual rate of growth is accelerating as prices near the all-time high. Both TREB’s 4.92% and the City of Toronto’s 5.92% 12-month price increase sent numbers higher. The rate of growth is now the highest since January 2018. Prices are just 1.57% below the all-time high reached in May 2017.

The median sale prices showed an even larger increase. TREB reported the median sale price of homes reached $699,888 in August, up 6.05% from last year. In the City of Toronto it increased to $685,000, up 7.45% from last year. The higher benchmark increase has to do with more pricey segments seeing a surge in volume. In the 905, detached homes were the largest driver of growth. In the City, it was semi-detached homes.

The average sale price of Toronto real estate jumped, but not quite as high as the other segments. TREB reported an average sale price of $792,611 in August, up 3.57% from last year. In the City of Toronto it hit $818,715, up 4.26% from last year. The driver here was condos in the 905, which saw the average jump 8.5% from last year.


Greater Toronto Real Estate Sales Hit Highest Level Since 2016

Toronto real estate sales made double digit gains, and hit the highest level since 2016 for the month. TREB reported 7,711 home sales in August, up 12.75% from last year. The City of Toronto represented 2,553 of the sales, up 4.58% from last year. This was the largest August since 2016, and in the past decade only 3 have printed bigger sales volumes. Looking at the breakdown, we can see the 905 is once again the driver, rising at twice the pace of the city.

Faster rising suburban sales appear to be a trend, same with slowing volumes in the City of Toronto. TREB shows 60,177 home sales year-to-date (YTD) in August, up 12.19% compared to last year. The City of Toronto represents 21,586 of those sales, up 5.86% from last year. This tells us that YTD growth in the suburbs was almost twice the pace of the City. Higher growth on the month than YTD also confirms acceleration of sales volumes across the board. In the City, lower growth on the month than YTD also shows deceleration in Toronto proper. If that was too wordy, the takeaway is growth in the 905 is rising, while slowing in the City of Toronto.


Greater Toronto Real Estate Inventory Falls Over 11%

The number of newly listed homes for sale dropped last month. TREB reported 11,789 new listings in August, down 3.09% from last year. The City of Toronto represents 3,727 of those new listings, down 0.66% over the same period. The decline in new listings, but increase in sales, helped to cut down on total market inventory.

Total inventory, called “active listings” made an even sharper drop than new listings. TREB reported 15,870 active listings in August, down 11.16% from last year. The City of Toronto represents 4,616 of the listings, down 3.99% over the same period. This is once again another confirmation that the 905 is heating up faster than the City.

Toronto real estate is seeing more sales, less inventory, and rising price growth. The 905 appears to be heating up faster than the City of Toronto, especially in terms of sales. The 905 is expected to see a bigger impact from the newly launched First Time Home Buyers Incentive program.

The introduction of the program has lead to an uptick in buyers trying to avoid anticipated price inflation. The CMHC, administrators of the program, expect the program to inflate prices up to 0.5%. However, that remains to be seen.

September usually marks the start of the fall market, when more condos and houses are listed, and sales traditionally increase up until late November when everything slows down for the holiday season.There are many good options out in the market for most buyers who have their mortgage financing approval in place.

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See a snapshot for each property type in the slideshow above, and take a look below for a snapshot summary of notable milestones for the Toronto and GTA real estate markets last month.




Here is a snapshot summary of the significant real estate milestones for Toronto and the GTA in August 2019

  • August sales up 13.4% compared to last year (7,711)
  • The ratio of sales-to-listings increased very slightly to 48.6% in August
  • The average sale price came in at $792,611 – up a positive 3.6% compared to last year
  • Note that this overall market average is now 8.4% higher than the average 2 years ago in August 2017
  • The GTA real estate market overall averaged the days-on-market at 25
  • Detached home sales in August 2019 with a purchase price over $2,000,000 were up 13% (149 houses) while condo apartment sales over $2M were down 37% (5 suites)
  • The condo share of the market was steady at 34.5% during the month
  • Downtown condo active listing numbers were up 8.5% in C01 and increased in C08 by 3.1% from last year at this time
  • August condo sales were down 7% in C01 and flat in C08 compared to 2018
  • The downtown condo days-on-market average was 21-23 days – 2-4 days faster than the overall market
  • The ratio of sales-to-listings for condos downtown was closely matched in C01 (61.9%) and in C08 (69.5%) but still much higher than in the overall market (48.6%).
  • Building on this higher demand due to better affordability, condo appreciation in the two main downtown markets averaged 4.6% to 5.1% year-over-year… similar to what we’ve been seeing all this year.
  • Markets in York Region and other 905 neighbourhoods have suffered the most from the market slowdown. However, sales numbers of houses have now started to increase significantly compared to condo suites although appreciation percentages are lower across the board in the 905.

     

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