Toronto’s housing market saw strong sales and price growth in February, while demand for housing continued to rise with limited supply for the market.
GTA realtors reported 7,256 residential transactions through TRREB’s selling system in February, representing a 45.6% increase compared to a 10-year sales low in 2019.
While February sales were still below the 2017 record result, year-over-year sales growth for the GTA as a whole was strongest for houses.
“Sales growth will be strong this year,” Michael Collins, TRREB President said.
While the report is calling for 97,000 sales in 2020, the annual pace of sales growth experienced in February will likely not be sustained throughout the year as comparisons to much stronger sales results reported after the first quarter of 2019 will be made, Collins said.
According to TRREB, new listings amounted to 10,613 in February 2020, a 7.9% increase compared to February 2019. The rate for houses listed was much smaller than the rate for sales, which means market conditions tightened considerably over the last year.
“Sales growth is well in excess of listing growth,” John DiMichele, TREB CEO said.
DiMichele notes that there is still a housing supply and demand problem in the GTA. Even with the Ontario Fair Housing Plan, which is aimed to increase housing supply, there is still not enough to meet the high demand for housing in the city.
“All levels of government have acknowledged the supply problem, but we need to very quickly move from policy briefs to shovels in the ground,” DiMichele said.
With the short supply of housing, competition between buyers has increased. This resulted in a further acceleration in year-over-year price growth in February, with the average home price up by 10.2%.
The average selling price for all home types combined was up by 16.7% to $910,290. The double-digit average price growth was experienced for most major market segments, including detached houses and condominium apartments.
“TRREB’s current average price forecast is for 10% price growth to $900,000 in 2020,” Jason Mercer, TRREB’s Chief Market Analyst, said.
“While this outlook represents a very robust pace of growth, it is possible that further tightening in the detached market segment could push the overall average selling price above TRREB’s baseline scenario. This could unfold if sales growth continues to outstrip new listing growth to the degree it has done so far in 2020.”