The price of a new construction single-family home fell 7.1 per cent — about $85,000 — year over year in September to $1.1 million on average. Condo prices, meanwhile, have continued to climb — up 19.4 per cent to $789,643 — an increase of $128,455 in a year.
Although they dominate the new-home market, the number of condo sales was down 20 per cent compared to September 2017 — which is also 20 per cent below the 10-year average for that housing category, according to numbers compiled by Altus Group for the Building and Land Development Association (BILD) on Wednesday.
Overall, the number of new-construction home sales nearly doubled last month to 1,747, compared to 974 in August, a healthier bump than the usual post-summer jump. Condos and stacked town homes accounted for 1,494 of those sales.
The 253 single-family home transactions — detached, semi-detached, townhouses and link homes — fell 28 per cent year-over-year, a 77 per cent decline from the 10-year average.
BILD CEO David Wilkes attributed the stronger month-to-month sales to a “re-awakening of consumer confidence” based in part on the new federal trade pact with the U.S.
He attributed softer single-family home prices to supply and demand.
“We’ve just come through a period of fairly soft demand, so perhaps that’s a reaction from the market to that,” said Wilkes.
The inventory of available condos and stacked town homes rose in September to 8,820 units, about five months’ supply. That includes homes that are complete, those in the pre-construction and construction phases. But a healthy Toronto region market should have nine months’ to a year’s worth of inventory given the population growth in the Toronto region, according to BILD.
That lack of supply is responsible for driving up the cost of condos, narrowing the price gap between those dwellings and single-family homes, said Wilkes.
The inventory of single-family lots rose to 5,132 in September, from 2,607 last year.
With both the municipal and provincial elections over, the province and municipalities need to get moving to boost the supply of homes in the Toronto area, said Wilkes.
“We have to make concrete decisions to free up supply through red tape (reduction), through ensuring that densities are what they need to be around transit nodes,” he said. “There are a variety of solutions that government is aware of. It’s time to stop thinking and start doing.”
Polling for BILD and the Toronto Real Estate Board prior to the municipal elections showed 57 per cent of Toronto-area voters believed it was increasingly difficult to own a home in the region, and 38 per cent indicated housing affordability among their top three election issues.