New home sales in the GTA off to a slow start in January 2016
By Lucas on Feb 22, 2016
According to the Building Industry and Land Development Association (BILD), new home sales are off to a slow start as of the end of January 2016, with a decline in sales, prices remaining flat, and a lack of inventory.
If you recall, BILD recently announced that 2015 was the third highest year on record for new home sales in the Greater Toronto Area (GTA), and we even saw new low-rise homes exceed an average price of $800,000 for the first time. It seems like things may be different this year. There was a total of 1,614 new home sales in the GTA in January 2016, which is 10% below the long-term average and 22% below January 2015’s total sales.
"While the number of new projects launched in January was similar to last year, the number of actual units in these projects was significantly lower," explains BILD President and CEO Bryan Tuckey. "You can't sell what you don't have, so fewer new homes brought to market means fewer sales." In January, only 1,379 new homes were brought to market, compared to 2,011 new homes brought to market the same period the year before.
In the new low-rise market, home sales decreased 5% compared to the long-term average. The average price fell by 1% compared to December 2015, but it is worth noting that the average price of $822,926 is still 17% higher than January 2015’s average. The average price of a new detached home in the GTA hit $985,899, which is less than 0.5% lower than December 2015’s average.
In the new high-rise market, the average price fell to $449,199, which is 1% lower than December 2015’s average. It is crucial to note that this is a result of decreasing unit sizes and not a lack of demand. The average price per square foot went up by 4% to $581, while the average unit size fell to 773 square feet, compared to 796 square feet a year ago.
By no means is the first month of the year any indication of the direction that the GTA’s housing market is headed, but it’s possible that we’re seeing a balancing of the market.
