Behind the numbers, Breaking down the market in March 2019
March 2019 sales figures followed a broader trend for the first quarter, with sales inline with the number of transactions reported through TREB’s MLS System during the first three months of 2018. Total March sales, at 7,187, were virtually unchanged from the number of sales reported in march 2018 (7,228). However, the March new listings statistic suggested that the market continues to be hampered by a lack of listings. New listings for March 2019 were down by 5.1 per cent compared to March 2018.
On the pricing front, the MLS Home Price Index Composite benchmark was up by 2.6 per cent year-over-year in March and the average selling price was up by 0.5 per cent to $788,335.
TAXES, OSFI AND SUPPLY
Whether it be proposed increases to the Toronto Municipal Land Transfer Tax, the strict OSFI-mandated mortgage stress test guidelines, or the low levels of housing stock available for purchase, there’s no doubt that relief is needed for the GTA housing market.
Indeed, the OSFI stress test continues to impact home buyers’ ability to qualify for a mortgage and TREB continues to press for a review of OSFI provisions and mortgage lending guidelines, including more flexibility around stress test provisions and allowable amortization periods for insured mortgages.
Similarly, while TREB commends the City of Toronto on the recently announced Housing TO – 2020-2030 Action Plan, a process we’re advising the City on, we question some of the City’s proposed sources of revenue that will be used for its implementation. Namely, a recently proposed increase to the Municpal Land Transfer Tax (MLTT) on higher priced properties to fund the Housing Allowance Program. This tax is problematic because the MLTT is not a sustainable revenue source. This became clear during the recent City budget process. Plus, additional MLTT on higher priced homes could cause a trickle down effect, negatively impacting the supply of homes throughout the housing price continuum by preventing people from “moving up” the continuum.
Finally, while sales continue to trend downward when compared to the record highs seen in 2016 and 2017, supply is receding as well and by an even greater margin. This lack of available supply has created increased competition between buyers, thereby driving up prices and amplifying housing affordability issues in the city.
It’s clear that all three of these issues need to be addressed and TREB will continue to lobby all levels of government for housing and housing related policies that are fair to home buyers, sellers and renters alike.
Garry Bhaura is president of the Toronto Real Estate Board. You can contact him at TREBpres@trebnet.com. For updates on the real estate market, visit trebhome.com. If commercial property is what interests you, contact a TREB realtor by visiting