A condo unit in the 905 is the most affordable option for buyers
By Lucas on Jun 06, 2016
Last week, the Toronto Real Estate Board (TREB) released its monthly resale housing figures for May 2016, announcing another record month of sales and shortage of listings.
There were 12,870 home sales reported through the MLS last month, which is 10.6% higher than the same time last year. This record high sales month also comes with a 6.4% drop in listings compared to May 2015. There was actually a decline in listings in both the low-rise and condo market.
“Whether we’re talking about existing homeowners or people looking to purchase for the first time, there is no shortage of buyers in the marketplace today,” says Mark McLean, President of TREB. “So, while the record number of home sales through the first five months of 2016 is not necessarily surprising, it does sometimes mask the larger story in the GTA: the shortage of listings, which has resulted in strong upward pressure on home prices.”
The average selling price in the GTA last month went up 15.7% to $751,908. The most expensive home type continues to be detached homes in the 416 area, which averaged $1,285,693. That is obviously very high and is a 15.2% increase compared to last year, but what’s more notable is the 21.2% increase in the 905 region where detached homes are selling for $891,870 on average.
“Widespread competition between buyers of singles, semis and townhouses across the GTA has underpinned the robust annual rates of price growth experienced so far this year,” explains Jason Mercer, TREB’s Director of Market Analysis. “With this said, however, it is also important to understand that tighter market conditions for condominium apartments have resulted in price growth well above the rate of inflation in this market segment as well.”
The largest increase TREB reported was of condo sales in the 905 region. There were 919 condo sales in the 905 last month, which is a 22.5% year-over-year increase. The rise in 905 condo sales could mean that downtown condo units are becoming too expensive for some buyers.
Couples and families looking for the convenience of a condo lifestyle are being forced to extend their search into the suburbs, and with the average selling price only $347,431 for a condo unit in the 905, it’s not surprising to see this shift happening.
Summer is typically a slower period for home sales, but will that be the case this year with listings at all-time lows across the GTA in both the resale and new home markets?
