The Building Industry and Land Development Association (BILD) released its new home sales figures for February 2017, announcing record high new condo sales and record low new low-rise inventory.
As of the end of February 2017, there were only 1,001 new low-rise homes available across the Greater Toronto Area (GTA), according to Altus Group, BILD’s trusted source for new home intelligence. A decade ago, there were 17,304 homes on the market! Only 324 units in the new low-rise inventory are detached homes, and the average price hit $1,469,449. Overall, the average price for a new low-rise home reached a record high of $1,081,013.
“February data demonstrates, quite clearly, that our housing supply crisis in the GTA is getting worse,” says BILD President and CEO Bryan Tuckey. “Our members are building to current provincial intensification policy and we are building less low-rise single-family housing and more high and mid-rise housing but consumer demand for low-rise homes has not dropped.”
“If I were shopping for a single-family home ten years ago, I would have been able to choose from among 500 different sites and nearly 18,000 units,” adds Patricia Arsenault, Altus Group’s Executive Vice President of Research Consulting Services. “Today, there are less than 100 projects with any available units to purchase, totalling only about 1,000 units. And I would have to act very quickly to get one of those.”
There were more than twice as many new condo sales (3,542) compared to new low-rise sales (1,541). The record high condo sales is a 79% year-over-year increase and more than double the 10-year average. In Toronto, there were 1,661 condo sales, and things really picked up in the 905 area with 105 sales in Durham, 107 in Halton, 370 in Peel, and 1,299 in York.
“Today in the GTA we have a scarcity of single-family ground-related housing that is not just unprecedented – it is almost inconceivable,” says Tuckey. “As a result we are seeing record breaking condo sales and continued price growth.”
The average price of a new condo in the GTA hit a record high of $523,086, which is a significant increase compared to January’s average of $507,511. The average price per square foot also reached a record high of $652. While the price per square foot went up, the average unit size dropped to 802 square feet.
“While the February results point to a trend decades in the making, the severity of the monthly figures, is jarring,” says Tuckey. “As the current data demonstrates, legislative guidelines and planning policies have real impacts on real people. With significant declines in builder inventory and record prices (for both low and high-rise homes), the GTA housing market is in crisis and it is time for governments to work with us to address the problems.”
With increased sales in the new condo market, that inventory is also taking a hit. Supply fell to a new low of 10,342 last month. If low-rise housing continues to become more unattainable, the new condo inventory may not be able to handle the demand!