The Toronto Real Estate Board (TREB) just released its January resale report for the Greater Toronto Area (GTA) housing market.

GTA resale transactions

The number of new homes listed through the TorontoMLS system in January 2014 came in at 8,822, a 16.6% decrease compared to the same time last year. What does this mean? Sales were also down and homebuyers had a hard time finding a resale home. There were only 4,135 sales in January, down 2.2% from January 2013.

“Looking forward, it is possible that strong price growth, and therefore an increase in home equity, will act as a trigger for more households to list their homes for sale.  This is especially the case for households whose life styles are changing, including those with an expanding family looking for a larger home or empty nesters looking to downsize,” said Dianne Usher, President of TREB.

The best selling home type in the resale market was detached homes, with 1,876 sales in January, followed by condo units (1,086), townhomes (677), and semis (421).

GTA resale prices

While number of listings and sales showed significant decreases, prices showed the opposite. The average selling price for a resale home in January 2014 was $526,528, more than 9% higher than the average for the same time last year ($482,080).

The highest priced home type was detached homes, with an average selling price of $686,688. For the month, the average price of condo units came in at almost half that price at $346,369!

“The pace of price growth will remain strong in 2014.  Similar to last year, competition between buyers for singles, semis and town homes in the City of Toronto and surrounding regions will continue to exert upward pressure on selling prices.  At the same time, mortgage rates will remain near historic lows, so despite strong price growth, home ownership will remain affordable for the average household in the GTA,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.

What does it all mean?

With fewer listings hitting the resale market, we might see prospective homebuyers turning to the new home market in search of early closings.

For the individual who wishes to abandon the car and live close to work, condos are still the most affordable option.

Strong demand and low inventory is driving the price of detached homes through the roof. It’s only a matter of time before builders start offering incentives on new home inventory to attract some would-be resale purchasers.