Things are looking up for the Toronto housing market.
New home sales increased by 20 per cent year over year in March, the Building and Land Development Association (BILD) announced on Thursday. That month, a total of 2,314 new homes were sold.
This increase in sales is a result of builders offering a more diversified selection of new construction homes at lower prices. This includes stacked townhomes, row houses, and mid- and low-rise apartments.
“The desire to own a new single-family home never went away, but many would-be buyers have been taking a wait-and-see approach in the past two years,” said Patricia Arsenault, Altus Group’s executive vice president of data solutions, in a news release.
“While the affordability of single-family homes in general remains a challenge, the broader range of product at more favourable price points that is starting to emerge has attracted some of these buyers into the market.”
Arsenault is right in that more Canadians are waiting out the market. According to RBC’s annual home ownership poll, 56 per cent of Canadians are waiting until 2020 to buy a home, as many believe house prices will drop.
Based on BILD’s numbers, this isn’t a bad tactic, as the price of single-family homes — including detached, semi-detached, and townhouses — fell by 7.6 per cent in the past year to $1,116,640. As the price fell, the number of units sold increased by 200 per cent. In March 2018, only 295 single-family homes sold in Toronto compared to 886 a year later.
The benchmark price of condo apartments, however, has gone up by 5.1 per cent in the past 12 months. That number now sits at $780,839.
The fact that new home sales are up is promising, despite the fact that March numbers are still 36 per cent lower than the 10-year average, according to Altus Group. However, BILD CEO David Wilkes says there are still challenges to overcome when it comes to affordability.
“We are lapping an historically low year,” Wilkes told the Toronto Star. “We’re seeing the green shoots of the activity increasing but we still have a long way to go to get back to 10-year averages.”