Average selling price continued to grow by close to 10% - September Resale Housing Figures

Greater Toronto REALTORS® reported 7,658 transactions through the TorontoMLS® system in September – a 25% increase over September 2010. Sales during the first three quarters of 2011 amounted to 70,588, representing a 2.6 per cent increase compared to the first nine months of 2010.
“We have experienced strong growth in sales so far this year, with a much more active summer compared to 2010. However, while sales have been strong, we have continued to experience a shortage of listings, resulting in more competition between home buyers,” said Toronto Real Estate Board President Richard Silver. “Over the past few months, the listing situation has started to improve, so we expect home buyers will have more homes to choose from in the months ahead.”
With annual growth in sales (+25 per cent) outstripping annual growth in new listings (+15 per cent) in September, market conditions became tighter and the average selling price continued to grow by close to 10 per cent on a year-over-year basis.
“Strong price growth through the first nine months of the year was mitigated to a great degree by low interest rates and rising incomes,” said the Toronto Real Estate Board’s Senior Manager of Market Analysis Jason Mercer. “As buyers continue to take advantage of the affordable home ownership options in the GTA, we remain on pace for the second best year for sales under the current TREB market area.”

Hot Summer Heated Up Toronto Real Estate Market in August

According to Toronto Real Estate Board (TREB) 7,542 Sales were reported by Greater Toronto REALTORS® through the TorontoMLS® system in August - a 24% increase over 6,083 sales in August 2010. New listings, at 12,509, were up by 20 per cent compared to August 2010. Market conditions remained tight as sales growth outstripped growth in new listings."Home sales in the GTA have stood up well despite a less certain economic outlook," said TREB President Richard Silver. "Home sales will be bolstered by low mortgage rates moving forward. The Bank of Canada is expected to be on the sidelines until the second half of 2012 or even into 2013. However, home ownership affordability in the City of Toronto could be further improved with the removal of the City's land transfer tax. This tax currently represents a substantial upfront cost for home buyers."
With market conditions remaining tight in the GTA, the average selling price continued to grow strongly in August – up by more than 10% year-over-year to $451,663.
"We remain on pace for the second best year on record for sales. Approximately 90,000 transactions are expected by the end of December," said TREB's Senior Manager of Market Analysis Jason Mercer. "Major home ownership costs, including the average monthly mortgage payment, remain affordable despite the strong price growth experienced so far this year."

Average April selling price growing by 9%

Greater Toronto REALTORS® reported 9,041 existing home sales through the TorontoMLS® system in April 2011. This result was down 17 per cent compared April 2010 when sales spiked to a new record of 10,898. While off last year's record result, April 2011 sales were in line with the average April sales level reported over the previous five years.
Existing home sales have been strong from a historic perspective through the first four months of 2011. Expect the pace of sales to remain robust through the spring, as the economy expands and home buyers continue to benefit from affordable home ownership opportunities.
Market conditions tightened markedly over the last year. April 2011 sales accounted for 62 per cent of new listings during the month – up substantially from 53 per cent in April 2010. Tighter conditions resulted in the average April selling price growing by 9% annually to $477,407.
"The number of listings has been below expectations so far this year. Increased competition between home buyers has led to an accelerating annual rate of price growth," said Jason Mercer, TREB's Senior Manager of Market Analysis. "The strong price growth experienced in April should result in more listings and more balanced market conditions."

Lower Sales but Higher Average Price

In February, Greater Toronto REALTORS® reported 6,266 transactions through the TorontoMLS® system. This result was 14% lower than the record sales reported in February 2010.
While not representing a record, February 2011 sales were 50% higher than the number reported in February 2009 during the recession and slightly higher than the average February sales over the previous ten years.
"Continued improvement in the GTA economy, including growth in jobs and incomes and a declining unemployment rate, has kept the demand for ownership housing strong," said Toronto Real Estate Board (TREB) President Bill Johnston.
The average selling price for February 2011 transactions was $454,423, which was more than 5% higher than the average selling price reported in February 2010.
"Market conditions remain quite tight in the GTA. There is enough competition between home buyers to promote continued price growth," said Jason Mercer, TREB's Senior Manager of Market Analysis.

Toronto Real Estate Sales Down in January but Average Price Continues to Grow

Greater Toronto REALTORS® reported 4,337 transactions through the TorontoMLS® system in January 2011, says Toronto Real Estate Board. This result was 13 per cent lower than the record result reported in January 2010.
"While off the record pace experienced a year ago, the Great Toronto Area resale market has started the year on a solid footing. Home buyers in Toronto and surrounding areas continue to benefit from a diversity of housing types for sale at many different price points," said TREB President Bill Johnston.

The average selling price for January 2011 sales was $427,037, representing an increase of over four per cent compared to the average of $409,058 reported in January 2010.
"The average selling price is expected to grow at a moderate pace in 2011. Growth rates in the three to five per cent range will be sustainable from an affordability perspective," said Jason Mercer, TREB's Senior Manager of Market Analysis.
The Number of Sales in Toronto (416) was 1,718 and the rest of GTA (905) was 2,619.
Median Price
In January, the median price was $360,000, from the $350,000 recorded during January of 2010.

Three new rules for the mortgage industry that will come into effect March 18

On January 17, 2011, Finance Minister Jim Flaherty announced new rules for Canadian mortgages that will "protect the stability of the economy."
Flaherty's announcement comes on the heels of a recent warning from the Bank of Canada that Canadians' domestic debt burden is the highest on record.
The announcement included three new rules for the mortgage industry that will come into effect March 18:
Mortgage amortization periods will be reduced from 35 years to 30 years.
The maximum amount Canadians can borrow to refinance their mortgages will be lowered from 90 per cent to 85 per cent of the value of their homes.
The government will withdraw its insurance backing on lines of credit secured on homes, such as home equity lines of credit.
It is the third time in three years that Flaherty has tightened credit rules while interest rates remain historically low.

The new restrictions are intended to ensure that Canadians don't slip into unmanageable debt, which could throw the economic recovery off the rails.
Flaherty targeted home-equity loans and lines of credit because some Canadians were using the money on consumer goods rather than to build equity into their homes, he said.
"They are used to buy boats and cars and big-screen TVs, and that's not the business mortgage insurance was designed for," he said. "Our measures will help improve the financial situation of households in Canada."
The Bank of Canada had announced earlier that Canadians' domestic debt burdens had hit the highest levels on record. The bank said the ratio of household debt to disposable income has reached 148 per cent -- which is higher than in the United States.
The International Monetary Fund also recently warned that household debt is the number one risk to the Canadian economy. Canadian household debt is now at $1.4 trillion, while mortgage delay payments have increased by 50 per cent.

Expect the average selling price to grow at or below five per cent in 2011

Toronto Real Estate Board made public on January 6, 2011 that Greater Toronto REALTORS® reported 4,395 existing home sales for the month of December, bringing the 2010 total to 86,170 – down by 1% compared to 2009.
"Market conditions were anything but uniform in 2010. We went from super-charged sales activity during the first four months of the year, to a marked drop-off in transactions in the summer and then in the fall saw sales climb back to levels that are sustainable over the longer term," said TREB President Bill Johnston."New Federal Government-mandated mortgage lending guidelines, higher borrowing costs and misconceptions about the HST caused a pause in home buying in the summer. As it became clear that the HST was not applicable to the sale price of an existing home and buyers realized that home ownership remained affordable, market conditions improved," continued Johnston.
The average home selling price in 2010 was $431,463 – up 9% in comparison to the 2009 average selling price of $395,460. In December, the average annual rate of price growth was five per cent.
"At the outset of 2010, we were experiencing annual rates of price growth at or near 20 per cent. This was the result of extremely tight market conditions coupled with the fact that we were comparing prices to the trough of the recession at the beginning of 2009," said Jason Mercer, TREB's Senior Manager of Market Analysis. "Balanced market conditions in the second half of 2010 resulted in more moderate home price appreciation," continued Mercer. "Expect the average selling price to grow at or below five per cent in 2011. With this type of growth, mortgage carrying costs for the average priced home in the GTA will remain affordable for a household earning an average income."

We Adjust When the Conditions Change

The tightening of mortgage criteria, the rise in mortgage rates and the introduction of HST increasing the cost of living, are probably the factors that are directly affecting Real Estate Market Sales.
Sales in Toronto dropped 29 per cent in the first two weeks of August compared with the same time last year, according to the Toronto Real Estate Board. The average price edged down 3.5 per cent from the average tally in mid-July. With prices slowly dropping, buying and selling tactics from the recent boom now seem as disposable as flip-flops. What worked for the last few months will not work in upcoming months. As the market shifts, we should understand, adapt, and capitalize. When homeowners won’t reduce their price, their properties might not move. By contrast, people who adapt to changes in the market have had more success.

Homes Sales down in June

During last month of June, greater Toronto REALTORS® reported 8,442 sales through theMultiple Listing Service® (MLS®).This represented a 23 per cent decrease compared to the record 10,955 sales reported in June 2009. Sales for the second quarter of 2010 amounted to 28,810 – up one percent annually. Year-to-date sales through June were up 23 per cent to 50,455compared to the first six months of 2009.“We experienced a record number of existing home sales during the first half of 2010,but these sales were weighted more towards the beginning of the year,” said newly elected Toronto Real Estate Board President Bill Johnston. “The pace of home sales has moderated from record levels over the past two months with the prospect of higher mortgage rates.”The average price for June transactions was $435,034.

$434,696 - Average Price for March Real Estate Transactions

According to TREB (Toronto Real Estate Board), greater Toronto Realtors® reported 10,430 sales through the Multiple Listing Service® (MLS®) in March, pushing total first quarter 2010 sales to 22,418 – the best result on record under the current Toronto Real Estate Board boundaries. The average price for March transactions was $434,696. The average price for the first quarter was $427,948.

These Happen When Interest Rates go up

When Lenders raise Mortgage (or Interest) Rates, (usually) a few things immediately happen in the Real Estate Market:
. Potential Home buyers have more difficulty to qualify for a mortgage (because now obtaining money from the lenders costs more).
. Potential Home buyers now qualify for smaller mortgage or don't qualify at all.
. Sellers (Property Owners) have more difficulty (depending on the location) to sell. They have to lower their expectations in terms of how long it's gonna take to sell the property(ies) and how much money they'll be able to obtain from a potential buyer in the new circumstances.

February Sales and Average Price Increase Annually

During last month of February, 7,291 sales were reported by Toronto Realtors through the Multiple Listing Service® (MLS®), representing a 77% increase over February 2009. The average price for these transactions was up 19 per cent year-over-year to $431,509.
Sales and average price increases represent both increased demand for ownership housing and the base year effect, which involves a comparison of economic recovery this year to a period of economic decline last year.
“Increases in existing home sales and average price were noted across the GTA in low-rise and high-rise home types. Similar rates of growth were experienced in the City of Toronto and surrounding 905 regions,” said TREB President Tom Lebour. “This suggests that first time, move-up and down sizing buyers are all active in the existing home marketplace.” New listings also increased in February, climbing 24 per cent compared to the same month last year.
“Annual growth in new listings is expected to continue. New listings growth will start to outstrip sales growth as we move through 2010,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “As the market becomes better supplied, we will see more sustainable single-digit rates of price growth.”

... and the Housing Market Stays the same: Hot

The Greater Toronto Realtors reported 8,196 sales in September 2009, up 28% from September 2008.
The average price for September transactions was $406,877 - up by 10% compared to the same month last year.
We've experienced an increasing rate of existing home price growth in the GTA as sales have continued to outpace 2008 results.
Consumers have remained confident in ownership housing as a long-term investment. Year-to-date sales, at 66, 437 were up 4.5% compared to the first 9 months of 2008. Average price, at $388,417 was up by almost 1.5%.
Existing home sales will finish strong this year, pushing through the 80,000 mark and moving in line with some of the best years on record under the current TREB (Toronto Real Estate Board) market area.

Toronto Real Estate Market Continued Strong in July

Although the unemployment figures are not improving, almost 45,000 jobs were lost in July, the Greater Toronto Realtors reported 9,967 Sales during the month of July 2009. Up 28% from July 2008.
The average price for the July Transactions was $395,414, up by six per cent compared to the same month last year.
The Real Estate Sector has been one of the sectors making a positive contribution to economic growth in GTA (Great Toronto Area).
Year-to-date Sales at 50,632 are down 1.2 per cent compared to the firs 7 months of 2008. Average price at $385,808 is down by less than one-half of one per cent.

The Best June on Record for GTA Resale Housing Market

According to Toronto Real Estate Board (TREB), in June 2009, Great Toronto Realtors reported a record 10,955 sales, up 27 per cent from June 2008. The seasonally adjusted annual rate of sales in June was 100,700.
The record result in une is testament to the fundamentally sound housing market in the GTA. An increasing number of households have been confident in purchasing a home in the region's affordable and diverse resale housing market.
The average price for June transactions was $403,972 - up by two percent compared to the same month last year.
The re-emergence of seller's market condition has exerted upward pressure on home prices. Look for sales to remain high relative to listings in the second half of the year. This will keep home prices growing.

Harmonized Sales Tax - The Impact in Real Estate Market

When it seems Toronto's real estate market begins to recover, realtors and home builders are worried Ontario's new harmonized sales tax could send sales plummeting again.

The number of home sales in the GTA in the first half of May was up 3% over the same period last year, after a series of year-over-year drops. The average price was $399,811, about the same as last May.
"We're out of the trenches for sure," said a senior manager of market analysis.

But the harmonized sales tax looms on the housing horizon. The tax will come into effect in July, 2010, combining the 5% GST and 8% PST into one 13% tax. The HST will apply to new homes and to all home closing costs, creating thousands of dollars more in taxes.

Currently, new homes are exempt from PST. Under the HST, new homes worth less than $400,000 will qualify for a 6% tax rebate, but new homes worth more than $500,000 will be subject to an additional 8% tax. This would mean an additional $30,000 on a $500,000 home.

The HST will hit new home buyers in Toronto harder because real estate prices are higher here, said Ontario Homebuilders Association president Frank Giannone.
"A $500,000 new home in Toronto doesn't get you much," said Mr. Giannone, who is also president of the Fram Building Group.
Mr. Giannone said the HST is a good idea, but current plans mean the entire purchase price is taxed once the $400,000 threshold is reached, and that could discourage middle-income earners from buying a new home.
"If you don't have your own place yet, or you have your own place and you're planning on moving up, you've hit a wall," Mr. Giannone said.

Only 7% of home buyers will be affected by the new tax, said Alicia Johnston, spokeswoman for the Ontario Ministry of Finance.

The HST may only apply to new homes, but closing costs on all homes will be hit with the 15% tax.
This will add approximately $2,000 extra in taxes per sale for costs such as home inspectors, lawyers and real estate commissions, said Toronto Real Estate Board chief government and media relations officer Von Palmer.
The additional $2,000 could hinder buyers who already struggle to save enough for a down payment, Mr. Palmer said, adding new taxes are not what the industry needs during a recession. "There is never a good time for a new tax, but this is bad," Mr. Palmer said.
He suggested the closing costs be exempt from the HST, but the government isn't considering that option.
"We can't exempt everything, otherwise it wouldn't be a harmonized sales tax," Ms. Johnston said.
Not everyone in the Ontario housing business thinks the HST means gloom and doom for the housing industry in the GTA.
"The HST is one factor that will impact sales next year, but it is only one of many factors," said Ted Tsiakopoulos, regional economist for the Canadian Mortgage and Housing Corporation.The Canadian Mortgage and Housing Corporation predicts sales in Ontario will pick up next year by 4.1% for resale homes and 1.9% for home starts

Toronto Condo Market Update

Condo Sales in Toronto are Down.
Despite a record number of construction cranes gracing the horizon, Toronto’s once thriving new condo market hit a dismal sales low in the first quarter of 2009.
The number of sales recorded during the first quarter dipped to 917 units – the lowest level since 1996 and a far cry from the high of nearly 7,000 units sold in the second quarter of 2007, the peak.
It’s a decline of 73% over the performance of last year, of 2008. The market really came to a halt in October, November and we haven’t picked up momentum through the first quarter.At the same time, ground has been broken on some 36,255 units now under construction in the region – a market high point. These are building projects that came to market in 2006 and 2007.