GTA new home market continues recent trends
Benchmark price for available new single-family homes in January was $1,229,454, which was 19.6 per cent above January 2017.
Sales of new single-family homes in the GTA hit their lowest level for January since before 2000, the Building Industry and Land Development Association (BILD) announced last week.
Single-family homes, including detached, link and semi-detached houses and townhouses (excluding stacked townhouses) represented only 365 units out of the 1,251 new homes sold in January, according to Altus Group, BILD’s official source for new home market intelligence.
“The January data continues a trend we have seen in the GTA,” said David Wilkes, BILD president and CEO. “Our industry wants to meet consumer demand in terms of the mix and type of homes available, but we are constrained by government policy. Affordability and the lack of supply of single-family housing remain a challenge.”
In the meantime, condominium apartments in low, medium and highrise buildings, stacked townhouses and loft units accounted for 70.8 per cent of new home sales, with 886 units sold.
“New condominium apartment sales in January were in line with typical levels for this time of year,” said Patricia Arsenault, Altus Group’s executive vice president of Research Consulting Services. “New condos remain an attractive option for end-user buyers looking for more affordable homes, as well as for investors who are ensuring needed new rental supply continues to flow into a tight rental market.”
In January, the benchmark price for available new single-family homes was $1,229,454, which was 19.6 per cent above January 2017. The benchmark price for condominium apartments was $714,430, which was 40.8 per cent above last January.
The new home market saw a very slight increase in supply in January, to 11,750 units, from 11,397 units in December. This is still well below what is considered a healthy level. Supply of new housing is typically measured by the number of new homes available for purchase in builders’ inventories at the end of the month and includes units in pre-construction, under construction and completed projects. A healthy new home market should have nine to 12 months worth of inventory and right now inventory is at about three to four months, based on the pace of sales in the past 12 months.
“The GTA is expected to grow to 9.7 million people by 2041,” Wilkes said. “How are we going to house them? All levels of government and the building industry have a role to play in increasing housing supply and we need to work together to simplify approval processes, update zoning by-laws and service developable land so we can bring more homes to market.”