There were only 795 new home sales in the GTA in August, which is 69% lower year-over-year and 62% below the 10-year average. Only 114 of the sales were in the new low-rise market, the rest were new condo sales.
“One month does not a trend make,” says BILD President and CEO Bryan Tuckey. “Late summer is a quiet time for real estate, and most builders wait until September to launch developments and bring new product to market. We are expecting fall to be very busy, and 2017 could still be a record year of new home sales driven by the incredibly strong condo market.”
Despite the big dip, year-to-date sales are still ahead of last year and 28% above the 10-year average. The GTA is still on track for a record year of new home sales! Out of the 31,749 new home sales so far this year, 80% of them have been in the new condo market.
Not much opened in August, but there was actually a slight increase in supply As of the end of the month, there were 6,608 condo units and 1,880 low-rise units available.
“The longer-term decline in single-family’s share of new home sales has now kicked into hyperdrive – dropping from about one-half in 2015, to one-third last year, to less than one-sixth in recent months,” says Patricia Arsenault, Altus Group’s Executive Vice President of Research Consulting Services. “While underlying demand suggests the pendulum should start to swing back a bit towards the single-family side, in reality it will be stopped in its tracks unless there is a significant increase in new single-family product making it to the market.”
With an increase in supply came a small drop in prices month-to-month. The average price of a low-rise home was $1,289,298, down from $1,316,693 in July. August’s average is still 38% higher than the same period last year.
In July, the average price of a condo unit was $665,041, which is slightly higher than August’s average of $644,327. Last month’s average price is still 34% higher year-over-year.
The drop in condo price is partially attributed to a decrease in average unit size, which fell from 871 square feet in July to 859 square feet in August. The average price per square foot also dropped to $750 from $764 in July.
Like Tuckey said, fall is expected to be busy and we’re already seeing signs of it!