GTA new home market shows improvement in September

Greater Toronto, Oct. 24, 2018 – The GTA new home market saw increases in September over the previous month, both in terms of new project openings and in terms of new home sales, particularly sales of condominium apartments, the Building Industry and Land Development Association (BILD) announced today.

There were 1,747 new homes sold in September, according to Altus Group*, BILD’s official source for new-home market intelligence—a sizeable increase over August’s 974 new home sales. Condominium apartments in low, medium and high-rise buildings, stacked townhouses and loft units accounted for 1,494 new home sales in September, down 20 per cent from September 2017 and down 20 per cent from the 10-year average. Single-family home sales, with 253 detached, linked and semi-detached houses and townhouses (excluding stacked townhouses) sold, were down 28 per cent from last September and down 77 per cent from the 10-year average.

With 10 condominium apartment projects and seven single-family home projects opening in September—a significant increase from August’s two project openings—remaining inventory increased to 13,952 units, comprised of 8,820 condo apartment units and 5,132 single family units. Remaining inventory includes units in preconstruction projects, in projects currently under construction, and in completed buildings.

“It appears more buyers—and builders—are starting to come in from the sidelines,” said Patricia Arsenault, Altus Group’s Executive Vice President, Data Solutions. “The increase from August in both new condominium apartment sales and the number of units in new projects launched was somewhat stronger than the typical September bump alone would suggest.”

David Wilkes, BILD President & CEO, said that was welcome news, but he pointed out that consumers still lack a range of options in the new home market, due to lack of supply. The 8,820 units remaining in the condo apartment inventory represent about five months’ worth of inventory, based on the pace of sales in the past 12 months. A healthy new home market should have nine to 12 months’ worth of inventory.

This shortfall in the supply of condominium apartments partly accounts for the closing gap between the prices of condos and single-family homes in the GTA. In September, the benchmark price for condo apartments rose again, to $789,643, which was up 19.4 per cent over the last 12 months, while the benchmark price for single-family homes softened again slightly to $1,119,533, down 7.1 per cent over the last 12 months.

“In the lead-up to the municipal elections, BILD succeeded in raising housing supply and affordability as major election issues,” said Mr. Wilkes. “Now we look forward to working with our municipal partners to address the barriers that stand in the way of building the housing our region needs to accommodate growth. Some straightforward steps include making sure that government charges on new homes are fair, funding and building critical infrastructure, cutting red tape and speeding up building permits and inspections."

September New Home Sales by Municipality**:

 Source: Altus Group

*Altus Group should be credited as BILD’s official source of new home market intelligence.

**Historical data are subject to revisions.

Source: BILDGTA.ca