The Toronto Real Estate Board (TREB) released its resale housing market figures for May 2018, as well as the results of a recent Ipsos poll on the importance of housing in the upcoming Ontario election.
In May 2018, there were 7,834 home sales in the Greater Toronto Area (GTA) reported through the MLS system, which is a 22.2% year-over-year drop. This is approximately the same amount of sales we saw in April. The largest year-over-year decline in sales was among semi-detached homes with a 29.4% drop; detached homes followed closely with 28.5% fewer sales compared to last year.
New listings fell 26.2% year-over-year, and when listings drop more than sales, it means that competition may be heating up between buyers.
“Homeownership remains a sound long-term investment. Unfortunately, many homebuyers are still finding it difficult find a home that meets their needs,” says Tim Syrianos, TREB President. “In a recent Canadian Centre for Economic Analysis study undertaken for the Toronto Real Estate Board, it was found that many people are over-housed in Ontario, with over five million extra bedrooms. These people don’t list their homes for sale, because they feel there are no alternative housing types for them to move into. Policy makers need to focus more on the ‘missing middle’ – home types that bridge the gap between detached houses and condominium apartments.”
The overall average selling price slipped 6.6% to $805,320. The average selling price of a detached home remains above $1 million, but fell 8% last month to $1,045,553. The only housing type to see positive price growth were condos, increasing 5.7% to $562,892.
“Market conditions are becoming tighter in the Greater Toronto Area and this will provide support for home prices as we move through the second half of 2018 and into 2019,” says Jason Mercer, TREB’s Director of Market Analysis. “There are emerging indicators pointing toward increased competition between buyers, which generally leads to stronger price growth. In the City of Toronto, for example, average selling prices were at or above average listing prices for all major home types in May.”
The Ipsos poll for TREB was conducted online with 1,200 GTA residents from May 18-22, 2018. The survey found that 25% of the residents named housing as one of the top two most important issues in the provincial election. It was also found that 35% strongly and 34% somewhat agree that housing details in the party platforms will influence their vote.
TREB also notes that 56% of the residents believe government policy should focus equally on increasing supply and reducing demand. When it comes to the provincial Land Transfer Tax, 77% support reducing the tax while 68% support repealing the tax completely.
Clearly housing should be a top priority for all provincial leadership parties. It will be interesting to see how the election results this week impact the GTA housing market for the rest of this year and into 2019.