Home sales in the GTA took a nose dive in May.
According to the latest report by the Toronto Real Estate Board (TREB), overall sales were down by 20.3% compared to last May, with detached homes down by 26.3%.
And while the sales were down, listings soared over the month, with the number of properties on the market at the end of May being 42.9% higher compared to a year earlier. TREB said the number increased for low-rise home types, including detached and semi-detached houses and townhouses. As for condos, active listings for were down compared to May 2016.
“Home buyers definitely benefitted from a better supplied market in May, both in comparison to the same time last year and to the first four months of 2017. However, even with the robust increase in active listings, inventory levels remain low,” said TREB president Larry Cerqua in a release. “At the end of May, we had less than two months of inventory. This is why we continued to see very strong annual rates of price growth, albeit lower than the peak growth rates earlier this year.”
The prices continued to rise in May, with the average selling price for homes soaring 14.9% to $863,910. In Toronto, the average price for a detached is up 16.6% and is now at $1,503,868.
The year-over-year price increases were greater for condos compared to low-rise home types, and TREB said this likely reflects the fact that the low-rise market benefitted most from the increase in listings. The average price for condos in Toronto is now over $560,000.
But it’s still unclear as to how the Ontario Fair Housing Plan will affect the market.
“The actual, or normalized, effect of the Ontario Fair Housing Plan remains to be seen. In the past, some housing policy changes have initially led to an overreaction on the part of homeowners and buyers, which later balanced out,” said Jason Mercer, TREB’s director of market analysis.
Mercer said that on the listings front, the increase in active listings suggests that homeowners, after a protracted delay, are starting to react to the strong price growth and are taking advantage of these equity gains.