Slide in average home price in Toronto ends, prices up from August
Sales of all major types of residential property fell, but the biggest move was a 40.4 per cent drop in sales of detached homes.
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TORONTO — The average price of a home sold in the Toronto area last month climbed higher on a month-over-month basis for the first time since hitting a record in April.
The average price has been falling since April when the Ontario government announced plans to try and cool the hot housing market including the introduction of a tax on foreign buyers.
The Toronto Real Estate Board said Wednesday the average selling price for a home sold in September was $775,546, up 5.9 per cent from $732,039 in August.
Compared with a year ago, the average price of a home sold in the Greater Toronto Area was up 2.6 per cent.
The rise came as the number of homes sold in the Greater Toronto Area totalled 6,379 in September, down 35 per cent from 9,830 in the same month last year. There were 6,335 homes sold in the GTA in August this year.
Royal Bank senior economist Robert Hogue estimated the Toronto market has had two straight months of balanced demand-supply conditions and that the downward price pressures seen earlier this year have eased.
However, he added that it doesn’t mean that prices are about to rebound.
"Rising interest rates, poor affordability and the possibility of further policy tightening will generate significant headwinds for local buyers," Hogue wrote in a report.
The number of new listings in the Toronto area on the Multiple Listing Service increased to 16,469 in September, up 9.4 per cent from a year earlier, and the number of active listings increased by 69 per cent from last year to 19,021.
"The improvement in listings in September compared to a year earlier suggests that home owners are anticipating an uptick in sales activity as we move through the fall," board president Tim Syrianos said in a statement.
The Toronto-area results come a day after the Real Estate Board of Greater Vancouver reported strong demand for condos and townhouses in September.
Prices and sales in the Vancouver market fell last year after the B.C. government moved to cool the housing market there with the introduction of a tax on foreign buyers. However, after the initial drop, prices and sales in Vancouver bounced back.
However, Hogue didn't think Toronto would react the same way.
"Rather, we believe that the GTA market may be facing a period of flat or minimally rising activity and prices," he wrote.
The Toronto board said high-priced detached homes accounted for a smaller share of sales than in September 2016. The region's average price for that category was flat at $1,015,067.
"With more balanced market conditions, the pace of year-over-year price growth was more moderate in September compared to a year ago," said Jason Mercer, the board's director of market analysis.
He added there was an exception in the condominium apartment market segment, where average and benchmark sales prices were up by more than 20 per cent compared to last year.
The average price for condos was up 23.2 per cent to $520,411 and the average price for semi-detached houses was up 7.4 per cent at $752,379.
Ontario Finance Minister Charles Sousa said the latest rise in prices suggests to him that the region is still a sought after location, noting that the economy and employment are up.
"I'm comfortable in the comprehensive measures we've taken to ensure sustainability in the marketplace and to ensure that there is no over extreme reaction and that hasn't happened," he said.
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