Tuesday, August 6, 2019

■Market Watch | August, 2019

GTA REALTORS® Release July 2019 Stats

August 6, 2019
 -- Toronto Real Estate Board President Michael Collins announced that Greater Toronto Area REALTORS® reported 8,595 sales through TREB's MLS® System in July 2019. This result was up by 24.3 per cent compared to July 2018. On a month-over-month basis, sales were up by 5.1 per cent, after preliminary seasonal adjustment.

New listings entered into TREB's MLS® System in July 2019 were up compared to July 2018, but by a much lesser annual rate than sales, at 3.7 per cent. With annual growth in sales far outstripping annual growth in new listings, market conditions clearly tightened compared to last year. Active listings at the end of July were down by 9.1 per cent year-over-year, further reflecting tightening market conditions.

As market conditions continued to tighten in July, the average selling price increased by 3.2 per cent on a year-over-year basis to $806,755. The MLS® Home Price Index Composite benchmark was up by 4.4 per cent. Higher density home types continued to drive price growth, whereas detached home prices remained down in many communities throughout the GTA.

Broadly speaking, increased competition between buyers for available properties has resulted in relatively strong price growth above the rate of inflation for semi-detached houses, townhouses and condominium apartments. However, the single-detached market segment, which has arguably been impacted most by the OSFI stress test, has experienced a slower pace of price growth, with average detached prices remaining lower than last year's levels in some parts of the GTA.

■Condo & Rental Market Report | Q2 2019

Condo Market Report
July 24, 2019 -- Toronto Real Estate Board President Michael Collins announced that Greater Toronto Area REALTORS® reported 7,038 condominium apartment sales through TREB's MLS® System in the second quarter of 2019. This result was up by 3.2 per cent compared to Q2 of 2018.

New condominium apartment listings entered into TREB's MLS® System were down by 3.5 per cent compared to Q2 2018, with 11,110 listings added in 2019 versus 11,512 listings added in 2018.

"As has generally been the case in the region since the implementation of the Ontario Government's Fair Housing Plan in 2017, the condo market segment has remained tight in comparison to other major housing types. However, from a price point perspective, condo apartments continue to offer prospective buyers a relatively affordable housing option when looking across the GTA," said Mr. Collins.

The average price of a condominium apartment increased by 5.1 percent from $561,343 in Q2 2018 to $589,887 in Q2 2019. Year-over-year price growth in the City of Toronto, which accounted for almost 70 percent of transactions, was slightly higher at 5.9 per cent, resulting in an average price of $639,316.

Through the first six months of 2019, condominium apartment completions reported by CMHC were down substantially on a year-over-year basis compared to the first half of 2018. Completions correlate to a certain degree with listings, as some investors choose to list their units for sale when title transfers to them from the builder.

The downturn in completions likely influenced both the year-over-year dip in new listings and the decline in the active listings count at the end of the second quarter. "The condominium apartment rental market also remained quite tight in the second quarter, with average rents for one-bedroom and two-bedroom apartments increasing above the rate of inflation on a year-over-year basis. However, we have seen an acceleration in the number of units listed for rent, which has provided renters with more choice in the market place and has coincided with a slower pace of average rent growth over the past year," said Jason Mercer, TREB's Chief Market Analyst.


Rental Market Report
July 4, 2019- Toronto Real Estate Board President Michael Collins announced that Greater Toronto Area REALTORS® reported 9,749 condominium apartment rental transactions through TREB’s MLS® System in the second quarter of 2019. This result was up by 14.9 per cent compared to Q2 2018. The number of condominium apartments that were listed at some point during the second quarter of 2019 was also up on a year-over-year basis by 28.8 percent, nearly doubling the annual growth rate for rental transactions, suggesting that the rental market became better supplied over the past year. “The GTA population continues to trend upward, as the region attracts people from around the world, both on a permanent and temporary basis, to take advantage of a diversity of employment opportunities. Many of these new comers and existing GTA households choose to rent. With this in mind, it makes sense that we continue to see strong year-over-year increases in the number of condominium apartments rented,” said Mr. Collins. The average Q2 2019 one-bedroom condominium apartment rent for the GTA as a whole was $2,192, up 6.7 percent compared to Q2 2018. Over the same period, the average two-bedroom condominium apartment rent increased by 4.3 per cent to $2,873. “While the rental market remains tight, renters do appear to be benefitting from more supply in the marketplace. The pace of year-over-year average rent growth has slowed over the past year. That being said, average condo rents continued to increase well-above the rate of inflation in the second quarter. This suggests that new rental supply, in terms of both purpose-built rental units and investor-owned condominium apartments, is still required in the GTA to keep up with population growth and new household formation,” said Jason Mercer, TREB’s Chief Market Analyst.

Friday, July 19, 2019

■Market Watch | July, 2019


GTA REALTORS® Release June 2019 Stats

July 4, 2019 -- The new President of the Toronto Real Estate Board, Michael Collins, announced that Greater Toronto Area REALTORS® reported 8,860 sales through TREB's MLS® System in June 2019, representing a 10.4 per cent increase compared to June 2018. Over the same time period, total new listings remained at a similar level for the month of June and active listings at month-end were down by 5.7 per cent.

Sales and new listings statistics for the first half of 2019 compared to the same period in 2018 painted a similar story to that of June. Sales were up by 8.5 per cent, while new listings were up by less than one per cent. This shows that sales accounted for a greater share of listings compared to last year, which means that competition between buyers increased, resulting in renewed price growth in many segments of the market.

"As I start my term as President of the Toronto Real Estate Board, I am proud to say that the Greater Toronto Area continues to grow, in terms of employment, population and overall diversity. As people are attracted to our region from all around the world, they obviously need a place to live. Over the next year, as demand for ownership and rental housing continues to grow, my hope is that we will see more movement from policy makers on two fronts: alleviating the constrained supply of housing and providing more flexibility around demand-side policies, including the OSFI two percentage point mortgage stress test and allowable amortization periods on insured mortgages," said Mr. Collins.

The overall average selling price in June 2019 was $832,703 – up by three per cent compared to the average of $808,066 in June 2018. Price growth was driven by the higher density market segments, including semi-detached houses, townhouses and condominium apartments. The MLS® Home Price Index Composite Benchmark was up by a similar annual rate of 3.6 per cent. For the first half of 2019, the average selling price was $810,661, representing an increase of 2.4 per cent compared to the first half of 2018.

"Buyers started moving off the sidelines in the spring, as evidenced by strong year-over-year price growth throughout the second quarter. However, because we saw virtually no change in the number of new listings, market conditions tightened and price growth picked up, especially for more higher density home types, which, on average, are less-expensive than traditional detached houses and therefore provide more affordable housing options under the new OSFI stress test regime," said Jason Mercer, TREB's Chief Market Analyst.

Thursday, June 13, 2019

■Market Watch | JUNE, 2019

GTA REALTORS® Release May 2019 Stats

June 5, 2019 -- Toronto Real Estate Board President Garry Bhaura announced that Greater Toronto Area REALTORS® reported 9,989 transactions through TREB's MLS® System in May 2019.* While this result represented a substantial increase of 18.9 per cent over the 15-year low in May 2018, it should be noted that the result was still below the average for month of May sales for the previous ten years, which stands at almost 10,300.

The year-over-year uptick in sales experienced so far in the second quarter of 2019 reflects spring polling results from Ipsos (undertaken on behalf of TREB) suggesting that the share of likely home buyers in the Greater Toronto Area has edged upwards since the fall.

"After a sluggish start to 2019, the second quarter appears to be reflecting a positive shift in consumer sentiment toward ownership housing. Households continue to see ownership housing in the GTA as a quality long-term investment as population growth from immigration remains strong and the regional economy continues to create jobs across diversity of sectors. However, sales activity continues to be below the longerterm norm, as potential home buyers come to terms with the OSFI mortgage stress test and the fact that listings continue to be constrained relative to sales," said Mr. Bhaura.

The number of new listings entered into TREB's MLS® System in May 2019 was up only slightly compared to May 2018, increasing by 0.8 per cent to 19,386. Year-over-year growth in new listings was far outstripped by year-over-year growth in sales. This means that market conditions continued to tighten in favour of sellers. The MLS® Home Price Index (HPI) Composite benchmark price was up by 3.1 per cent on a year-over-basis. The average selling price for all home types combined was up by a similar 3.6 per cent to $838,540. Price growth was driven by the condominium apartment and townhouse market segments.

"We are experiencing annual rates of price growth that are largely sustainable right now in the GTA – above the rate of inflation, but in the single digits. If, however, we continue to see growth in sales outstrip growth in new listings, price growth will accelerate. This potential outcome underpins calls from TREB and other housing industry stakeholders to address roadblocks preventing a more sustainable and diverse supply of housing reaching the market. Many households are not comfortable listing their homes for sale because they feel that there are no housing options available to better meet their needs," said Jason Mercer, TREB's Chief Market Analyst.

*The total sales in May 2018 were not as low as originally reported and have been upwardly revised to 8,402 from 7,834. The initial estimate of sales was conservative due to a one-off reporting discrepancy that was discovered when the May 2019 reports were being produced.

Monday, May 6, 2019

■Market Watch | MAY, 2019

GTA REALTORS® Release April 2019 Stats
May 6, 2019 -- Toronto Real Estate Board President Garry Bhaura announced that Greater Toronto Area REALTORS® reported a substantial year-over-year increase in home sales in April 2019. The number of residential transactions jumped by 16.8 per cent to 9,042 compared to 7,744 in April 2018. On a preliminary seasonally adjusted basis, sales were up 11.3 per cent compared to March 2019.

New listings were also up year-over-year by eight per cent. However, the annual growth rate for new listings was much lower than that reported for sales. This suggests that market conditions continued to tighten which points toward an acceleration in price growth.

"The strong year-over-year growth in sales is obviously a good news story and likely represents some catch-up from a slow start to the year. TREB's sales outlook for 2019 anticipates an increase relative to 2018. It should be noted, however, that growth in new listings is not keeping pace with sales. This points to the ongoing housing supply issue in the GTA. In this regard TREB welcomes the provincial government's Housing Supply Action Plan announced last week to reduce red tape and improve the mix of housing types. TREB provided input on the Plan through submissions and participation on working groups," said Mr. Bhaura.

The year-over-year rate of price growth generally edged up in April relative to the first three months of the year. The MLS® HPI Composite benchmark was up by 3.2 per cent – the highest rate of growth in more than a year. The average selling price was up by 1.9 per cent to $820,148, representing the strongest annual rate of growth so far in 2019. On a preliminary seasonally adjusted basis, the average selling price was also up by 1.1 per cent compared to March 2019.

Price growth continued to be driven by the condominium apartment segment and higher-density low-rise segments. The average price for detached houses dipped year-over-year, specifically in regions surrounding the City of Toronto. The detached market segment, with the highest price point on average, has arguably been hardest hit by measures such as the OSFI stress test.

"While sales were up year-over-year in April, it is important to note that they remain well-below April levels for much of the past decade. Many potential home buyers arguably remain on the sidelines as they reassess their options in light of the OSFI-mandated two percentage point stress test on mortgages. Longer term borrowing costs have trended lower this year and the outlook for short-term rates, for which the Bank of Canada holds the lever, is flat to down this year. Unfortunately, against this backdrop, we have seen no movement toward flexibility in the OSFI stress test," said Jason Mercer, TREB's Chief Market Analyst.

■Condo & Rental Market Report | Q1 2019




Condo Market Report

April 24, 2019 -- Toronto Real Estate Board President Garry Bhaura announced that Greater Toronto Area REALTORS® reported 4,731 condominium apartment sales through TREB's MLS® System in the first quarter of 2019. This result was down by 6.8 per cent compared to Q1 of 2018.

New condominium apartment listings entered into TREB's MLS® System were up by 2.4 per cent compared to Q1 2018, with 8,222 listings being added in 2019 versus 8,029 listings added in the first three months of 2018.

"While we experienced a slightly better-supplied condo market in the first quarter of 2019, the market segment remained tight enough to retain the highest year-over-year rate of price growth compared to other major home types. Condos continue to provide prospective buyers with a relatively affordable housing option in the GTA, especially given the impact of the OSFI-mandated mortgage stress test," said Mr. Bhaura.

The average price of a condominium apartment increased by 4.5 per cent from $533,520 in Q1 2018 to $557,377 in Q1 2019. Year-over-year price growth in the City of Toronto, which accounted for 69 per cent of transactions, was slightly higher at 5.4 per cent resulting in an average price of $603,243.

Condominium apartment listings, in both the ownership and rental markets, can be influenced by the completion of new condominium apartment projects. According to CMHC, condo apartment completions were up substantially year-over-year in the fourth quarter of 2018, which could account for an uptick in condo ownership and rental listings in Q1 2019. Conversely, condo apartment completions were down year-over-year in Q1 2019, which could arguably impact listings in the opposite manner over the next three months.

"The condominium apartment rental market remained very tight through the first three months of 2019. Average one-bedroom and two-bedroom rents were up well-above the rate of inflation on a year-over-year basis in the first quarter. However, the condo rental market also benefitted from an increase in the number of units listed, resulting in more choice for prospective renters. With this said, we would need to see a number of quarters with listings growth outstripping rental transaction growth in order for the market to become more balanced," said Jason Mercer, TREB's Chief Market Analyst.


Rental Market Report

April 3, 2019 – Toronto Real Estate Board President Garry Bhaura announced that Greater Toronto Area REALTORS® reported 6,646 condominium apartment rental transactions through TREB’s MLS® System in the first quarter of 2019. This result was up by 7.7 per cent compared to Q1 2018. Rental transactions were up for bachelor, one-bedroom and two-bedroom apartments.

The number of condominium rental apartments listed at some point during the first quarter of 2019 was also up on a year-over-year basis by 22.4 per cent – outstripping the annual growth rate for rental transactions.

“It makes sense that we continued to see an increase in condominium apartment rentals during the last quarter. The GTA’s population continues to grow as people are attracted to the region by its strong economy and diversity. At the same time, it was also good to see an increase in the number of units listed for rent. However, with average rents continuing to increase well-above the rate of inflation on an annual basis, market conditions clearly remain tight. Development of more rental supply is imperative to the long-term sustainability of the GTA rental market,” said Mr. Bhaura.

The average Q1 2019 one-bedroom condominium apartment rent for the GTA as a whole was $2,143 – up 7.4 per cent compared to Q1 2018. Over the same period, the average two-bedroom condominium apartment rent increased by six per cent to $2,811.

“Affordable rental housing is an important component in the overall competitiveness of the GTA. Businesses and individuals are more likely to locate in regions where there is a ready supply of affordable housing alternatives. While condominium apartment investor-owners have provided the great majority of new rental stock over the past decade, we know there is a need for many more rental units, as evidenced by vacancy rates hovering around one per cent. TREB looks forward to working with policy makers in the design of proactive housing policies pointed at the development of new rental supply, including during the recently announced City of Toronto Housing TO consultations,” said Jason Mercer, TREB’s Chief Market Analyst.