Toronto’s housing market chalked up a stellar June, with both sales and prices surging from a year earlier.
Friday’s report from the Toronto Real Estate Board adds to the sentiment expressed this week by the Conference Board of Canada, which said the city’s residential real estate market was dinged by a harsh winter but should rebound.
Home sales in Canada’s biggest city climbed 15.4 per cent in June from a year earlier, to 10,180, the Toronto board said.
The average price rose 7.4 per cent over the same period, to $568,953.
Prices for semi-detached homes came in with the strongest showing, up 9.7 per cent. Notably, the condo market, which many observers deem frothy, saw price gains of 6.8 per cent.
“Despite higher inventory levels, the condominium apartment market segment has benefitted from enough buyer interest to result in above-inflation price growth,” said the group’s senior manager of market analysis, Jason Mercer.
Paul Etherington, the new president of the real estate board, added he expects to see sales continue to climb through the summer.
This came after a Conference Board of Canada report showed that the ugly winter may have hurt Toronto’s housing market, but that the end result could be “negligible.”
The city some 18,000 home sales and the start of construction on 7,000, each below the 10-year average, says the group’s senior economist Robin Wiebe.
Compared to the norm, sales in the first three months of the year were probably down by about 9 per cent, and housing starts by 5 per cent, he wrote in the Conference Board’s economics blog.
“Our statistical analysis found that snow and lower temperatures were both significantly linked to fewer sales of existing homes, while colder weather appears to significantly dampen only starts,” he said.
“The ability of Toronto’s new construction businesses to take winter precipitation in stride could be because construction firms have equipment to move it.”
Between January and March, Mr. Wiebe noted, average temperatures were markedly lower than those of the past decade, while snowfalls were notably greater.
Not only that, he said, this winter likely seemed harsher because those of the previous two years were “relatively tame.”
“In general, winter is an unforgiving time for housing markets,” Mr. Wiebe added.
“Working outside in inclement weather to build new homes is physically demanding and sometimes dangerous. Moreover, some construction materials behave differently or are simply unusable below water’s freezing point.”
And so, just about 20 per cent of Toronto housing starts are usually done in the winter.
While this winter was rough, the hit was “relatively minor,” Mr. Wiebe said.
“More important, over the coming quarters, home sales and housing starts may accelerate to recover lost ground,” he added. “So for 2014 as a whole, Toronto’s very cold winter may end up having a negligible impact on the city’s housing market.”
Source: Michael Babad @ The Globe & Mail