TORONTO, December 5, 2017 — Toronto Real Estate Board President Tim Syrianos announced that Greater Toronto Area REALTORS® reported 7,374 transactions through TREB’s MLS® System in November 2017. This result was up compared to October 2017, bucking the regular seasonal trend.  On a year-over-year basis, sales were down by 13.3 per cent compared to November 2016.

New listings entered into TREB’s MLS® System in November 2017 amounted to 14,349 – up by 37.2 per cent compared to November 2016, when the supply of listings was very low from a historic perspective.

“We have seen an uptick in demand for ownership housing in the GTA this fall, over and above the regular seasonal trend.  Similar to the Greater Vancouver experience, the impact of the Ontario Fair Housing Plan and particularly the foreign buyer tax may be starting to wane.  On top of this, it is also possible that the upcoming changes to mortgage lending guidelines, which come into effect in January, have prompted some households to speed up their home buying decision,” said Mr. Syrianos.

The MLS® Home Price Index (HPI) composite benchmark price was up by 8.4 per cent on a year-over-year basis in November 2017.  The average selling price for all home types combined was down by two per cent compared to November 2016, due in large part to a smaller share of detached home sales versus last year.  On a year-to-date basis, the average selling price was up by 13.4 per cent compared to the same period last year.  High density home types continued to lead the way in terms of price growth, with the average condominium apartment price up by double-digits compared to November 2016.

“Changes in market conditions have not been uniform across market segments.  In line with insights from consumer polling undertaken by Ipsos in the spring, we are still seeing seller’s market conditions for townhouses and condominium apartments in many neighbourhoods versus more balanced market conditions for detached and semi-detached houses.  We will have more insights to share about consumer intentions for 2018 at the end of January when TREB releases its third annual Market Year in Review and Outlook report,” said Jason Mercer, TREB’s Director of Market Analysis.

Source: Toronto Real Estate Board

Toronto Real Estate Board President Tim Syrianos reported 7,118 residential sales through TREB’s MLS® System in October 2017. This result represented an above-average increase between September and October of almost 12 per cent, pointing to stronger fall market conditions.

On a year-over-year basis, October sales were down compared to 9,715 transactions in September 2016. Total sales reported through the first 10 months of 2017 amounted to 80,198 – down from 99,233 for the same time period in 2016.

“Every year we generally see a jump in sales between September and October. However, this year that increase was more pronounced than usual compared to the previous ten years. So, while the number of transactions was still down relative to last year’s record pace, it certainly does appear that sales momentum is picking up,” said Mr. Syrianos. The MLS® Home Price Index Composite benchmark price was up by 9.7 per cent on a year-over-year basis in October. Annual rates of price growth were strongest for townhouses and condominium apartments. The average selling price for October transactions was $780,104 – up by 2.3 per cent compared to the average of $762,691 in October 2016.

“The housing market in the GTA has been impacted by a number of policy changes at the provincial and federal levels. Similar to the track followed in the Greater Vancouver Area, it appears that the psychological impact of the Fair Housing Plan, including the tax on foreign buyers, is starting to unwind,” said Jason Mercer, TREB’s Director of Market Analysis.

“TREB will be undertaking its annual consumer polling process over the last two months of 2017. This polling will include research into the impact of recent and proposed government policy changes on consumer intentions to buy and sell homes in the GTA, including the impacts of the new OSFI guideline and a potential vacancy tax in the City of Toronto. In addition, TREB continues to work with different levels of government on solutions to the long-term housing supply issues in the region,” added Mr. Syrianos.

Source: Toronto Real Estate Board

Greater Toronto Area REALTORS® reported 2,706 sales through TREB’s MLS® System during the first 14 days of August 2017. This result was down by 35.6 per cent compared to the first 14 days of August 2016.

Over the same period of time, the number of new listings entered into TREB’s MLS® System was down by 10 per cent on a year over year basis. New listings were down in the City of Toronto and the surrounding regions making up the GTA.

The average selling price during the first two weeks of August, at $731,614, was up three per cent compared to the same period in 2016. Overall average price growth was driven by the condominium apartment and semi-­‐detached market segments, which experienced double-­‐digit average annual rates of price growth.

Source: The Toronto Real Estate Board

Greater Toronto Area REALTORS® reported 2,670 residential transactions through TREB’s MLS® System during the first 14 days of July 2017. This result was down 39.3 per cent compared to the same period in 2016. The greatest year-over-year decline in sales was noted for the detached market segment. The lowest annual rate of decline was noted for the condominium apartment market segment.

The number of new listings entered into the system was up by 6.5 per cent year-over-year. While still up compared to last year, the annual rate of growth for new listings has declined markedly, from over 40 per cent in mid-May, and over 20 per cent in mid-June, to less than seven per cent in mid-July.

With sales down and new listings up year-over-year, the market was better supplied compared to last year. This translated into a more moderate 6.5 per cent annual growth rate for the average selling price, which was $760,356 for all home types combined.

When breaking down average price growth by geography, an interesting dichotomy has developed between the City of Toronto and the surrounding ‘905’ area code regions for some market segments. The annual growth rate for the average detached price in the ‘416’ area code was 12.1 per cent, compared to 2.7 per cent for the ‘905’ regions. The annual growth rate for the average condominium apartment price was 30.5 per cent in the ‘416’ area code versus 12.4 per cent in the surrounding ‘905’ regions.

Source: The Toronto Real Estate Board

In lieu of a Bank of Canada rate hike here is a quick cheat sheet of answers to commonly raise obstacles to hiking once, twice, three times and more. Call it an economist’s attempt at late night comedy, minus the part about being funny of course because this is about monetary policy.

1. This is no longer an emergency of recession but we still have emergency rates. This is 2017. Not 2009 or even 2014.
2. Housing can take it and a cooler market for affordability is welcome to a point. Toronto housing will continue to cool near term. Rule changes make it so borrowers have to qualify at a 4.6% average 5 year posted rate more than 200 points above the effective best offer 5 year rate. There is a built-in rate shock buffer in mortgage rules. Plus it’s not like the Fed raising 425bps over 2004-06. It’s also seriously misinformed to view parallels between the US housing finance system back then and Canada’s today.
3. Consumers can take it. Disposable income growth is about 4% y/y now, 3%+ next year. 50-75bps+ on debt service is swamped by this effect. Don’t just adjust rates, consider income growth and increased international purchasing power.
4. Exports can take it. USDCAD and the real effective exchange rate are where they have averaged for the past two years, which is what matters to lagging trade effects. Income effects from an improving global economy can offset price effects from the exchange rate.
5. Investment can take it. Overall financing conditions are and should remain very stimulative aided by CAD strength given high reliance on imported capital goods. Capacity pressures will require expansion supported by gains in worker productivity. Resource maintenance cap-ex can no longer be postponed.
6. Slack is being rapidly eroded with growth more than double the non-inflationary speed limit on average for the past 4 quarters. Spare capacity disappears by both output gap measures this year and then Canada begins slipping into excess aggregate demand.
7. Core inflation will be bottoming into the Fall. Ending 2018 at 1.9% as excess aggregate demand arrives and followed by further progress into 2019. That’s not emergency conditions. Monetary policy needs to lean in front of that occurring instead of pointing to the last inflation report in order to mitigate the rise given monetary policy lags. The costs to being wrong about inflation upsides are less than the costs to maintaining emergency insurance against forecast risks.The Fed can afford to pause being 100bps ahead but Canada hasn’t started. A 10% sustained two year average appreciation (ie: not from a transitory peak) in CAD versus the USD knocks 0.1-0.2% off core inflation two years out. Other forces are likely to dominate currency effects that the BoC views as transitory anyway.
8. Wage growth is also bottoming. Rapidly tightening job markets, a maturing commodity shock on incomes and minimum wage hikes in Ontario and Albert should lift wage growth into 2018.
9. Business surveys – like the Bank of Canada’s BOS – are saying growth is durable with plans to keep on investing and hiring.
10. Downbeat risks are generally not being realized. NAFTA has not been torn up, there are no border taxes, an imported bond shock hasn’t arrived and some geopolitical risks have improved (European elections) while others remain.

Source: Scotiabank Global Economics Special Report July 2017

Toronto Real Estate Board President Larry Cerqua announced that Greater Toronto Area REALTORS® reported 10,196 sales through TREB’s MLS® System in May 2017 – down by 20.3 per cent compared to 12,790 sales reported in May 2016.  Sales of detached homes were down by 26.3 per cent.  Sales of condominium apartments were down by 6.4 per cent.

The supply of listings was up strongly over the same period.  Active listings – the number of properties available for sale – at the end of May were up by 42.9 per cent compared to the record low a year earlier.  The number increased considerably for low-rise home types including detached and semi-detached houses and townhouses.  Active listings for condominium apartments were down compared to May 2016.

“Home buyers definitely benefitted from a better supplied market in May, both in comparison to the same time last year and to the first four months of 2017.  However, even with the robust increase in active listings, inventory levels remain low.  At the end of May, we had less than two months of inventory.  This is why we continued to see very strong annual rates of price growth, albeit lower than the peak growth rates earlier this year,” said Mr. Cerqua.

Selling prices continued to increase strongly in May compared to the same month in 2016.  The MLS® HPI Composite Benchmark price was up by 29 per cent year-over-year.  The average selling price for all home types combined for the TREB Market Area as a whole was up by 14.9 per cent to $863,910.  Year-over-year price increases were greater for condominium apartments compared to low-rise home types.  This likely reflects the fact that the low-rise market segments benefitted most from the increase in listings.

“The actual, or normalized, effect of the Ontario Fair Housing Plan remains to be seen.  In the past, some housing policy changes have initially led to an overreaction on the part of homeowners and buyers, which later balanced out.  On the listings front, the increase in active listings suggests that homeowners, after a protracted delay, are starting to react to the strong price growth we’ve experienced over the past year by listing their home for sale to take advantage of these equity gains,” said Jason Mercer, TREB’s Director of Market Analysis.

Source: The Toronto Real Estate Board

Toronto Real Estate Board President Larry Cerqua announced that Greater Toronto Area REALTORS® entered 33.6 per cent more new listings into TREB’s MLS® System in April 2017, at 21,630, compared to the same month in 2016. New listings were up by double-digits for all low-rise home types, including detached and semi-detached houses and townhouses. New listings for condominium apartments were at the same level as last year.

Total sales for the TREB market area as a whole amounted to 11,630 – down 3.2 per cent year-over-year. One issue underlying this decline was the fact that Easter fell in April in 2017 versus March in 2016, which resulted in fewer working days this year compared to last and, historically, most sales are entered into TREB’s MLS® System on working days.

“The fact that we experienced extremely strong growth in new listings in April means that buyers benefitted from considerably more choice in the marketplace. It is too early to tell whether the increase in new listings was simply due to households reacting to the strong double-digit price growth reported over the past year or if some of the increase was also a reaction to the Ontario government’s recently announced Fair Housing Plan,” said Mr. Cerqua.

The MLS® Home Price Index (HPI) Composite Benchmark Price was up by 31.7 per cent yearover-year in April 2017. Similarly, the average selling price for all home types combined was up by 24.5 per cent to $920,791.

“It was encouraging to see a very strong year-over-year increase in new listings. If new listings growth continues to outpace sales growth moving forward, we will start to see more balanced market conditions. It will likely take a number of months to unwind the substantial pent-up demand that has built over the past two years. Expect annual rates of price growth to remain well-above the rate of inflation as we move through the spring and summer months,” said Jason Mercer, TREB’s Director of Market Analysis

Source: Toronto Real Estate Board

Greater Toronto Area REALTORS® reported 6,098 transactions through TREB’s MLS® System during the first 14 days of April 2017. This result was up by 10.8 per cent in comparison to the same time period in March 2016. Sales were up for all major home types on a year-over-year basis – both in the City of Toronto and surrounding regions making up the TREB market area.

The number of new listings was also up annually, at 8,978 compared to 7,696 – an increase of 16.7 per cent. It is interesting to note that the annual rate of increase for new listings outstripped the annual rate of increase for sales. This means that market conditions were less tight compared to last year, with sales accounting for a smaller share relative to new listings.

The overall average selling price for transactions reported during the first two weeks of April was up by 29.8 per cent compared to the first two weeks of April 2016. Looking at the TREB market area as a whole, the strongest annual average rate of price growth was experienced in the condominium apartment market segment.

Looking forward, growth in new listings will have to outstrip growth in sales for a sustained period of time in order for more balanced market conditions and, by extension, a more moderate pace of home price growth to emerge.

Source: Toronto Real Estate Board