Even winter hasn’t been able to cool down the GTA housing market.
Sales were up 18 per cent and the average transaction price was up 10 per cent in mid-December over the same time last year, largely because of the lack of enough houses for sale to meet a surge of demand that started last summer, according to statistics released Tuesday by the Toronto Real Estate Board.
The average selling price of a home in the first two weeks of December was $520,379, up from $471,602 as of mid-December of 2012, says TREB.
“The key story in the GTA housing market continues to surround the availability of listings, or lack thereof,” said TREB president Dianne Usher in a statement.
“We have seen a resurgence in buying activity in the second half of 2013. However, growth in listings has not matched growth in sales. The result has been more buyers competing for fewer listings.”
The shortage of detached, semi-detached and townhomes listed for sale, especially in the City of Toronto, is expected to continue through 2014 and could drive up prices a further 3.5 or 4 per cent, says Jason Mercer, TREB’s senior manager of market analysis.
Historically, rising prices encourage more listings, with homeowners looking to cash out or use their increased equity to buy up, says Mercer. But that hasn’t been happening to the same extent as usual.
In fact, the market has been plagued by a shortage of listings for about three years now, which TREB blames on the added costs of moving, such as Toronto’s double land transfer tax. Those costs are encouraging many homeowners to stay put and renovate.
The inventory problem has been exacerbated in the second half of 2013 by folks who put their decision to buy on hold in 2012, which played out in lower sales levels through much of last year.
Many seem to have restarted their search this spring, only to find they are competing against more people for the same, or sometimes fewer, properties than usual.
All of that has helped drive up prices, and fuelled bidding wars, such as one on Hazelwood Ave. in the Pape and Danforth area that recently saw 15 people register bids on a renovated semi listed for $649,900.
At times, there were lines of folks out the front door, waiting to take a tour.
Although two potential buyers later withdrew, the renovated house in the sought-after Frankland school district sold for $785,100, more than $135,000 over the asking price.
Some realtors say they’ve never seen so many househunters still out looking this close to the usually quiet Christmas season.
As of mid-December, resale condo transactions lead the way, with sales via the MLS system up 18.5 per cent in the City of Toronto and 43 per cent in the suburbs (although just 216 units changed hands across the 905 regions).
Prices were up 7.9 per cent, to an average of $365,559 in Toronto and 1.7 per cent, to $291,496, in the 905 regions.
Sales of detached homes were actually down 4 per cent in the City of Toronto and prices were up 15.4 per cent to an average of $804,830, says TREB. That compares to an almost 21 per cent increase in sales of detached homes in the 905 region, where the average transaction price was up 14.7 per cent to $633,549.
Semi-detached sales were up almost 14 per cent in the 416 region, with the average sale price up 19.4 per cent to $647,314. In the 905 regions, sales were up 10.3 per cent and prices up 7.3 per cent to an average of $410,425.
Townhouse sales were up almost 18 per cent in Toronto and prices up 8.3 per cent to an average of $444,378. That compares to a 19.6 per cent increase in sales and 12.2 per cent increase in average transaction prices, to $387,674, in the 905 regions.
Source: Susan Pigg @ The Star