A narrowing gap between condo prices and the cost of a single-family house helped cement the recovery of new construction single-family home sales last year after a 22-year low in 2018.
Single-family home prices — a category that includes detached, semi-detached and townhouses — fell about 4.8 per cent year over year to a benchmark of $1.09 million in December in the Greater Toronto Area.
Condo prices rose 15 per cent during the same period to $916,585, putting the difference in price at about $172,000 according to the Building Industry and Land Development Association (BILD).
The 157 per cent bounce in single-family home sales, to 9,523 last year, follows only 3,831 sales in 2018, said BILD on Thursday.
Fewer resale home listings also aided the new construction side of the housing market, said Patricia Arsenault, executive vice-president of Altus Group, which tracks new home construction.
“The 2019 performance in the new single-family home market, however, needs to be put in perspective,” she said. “Sales were still very low in historical terms, as available product to purchase remains limited, in particular at price points that are affordable to a broader range of buyers.”
Condo sales, which include stacked town homes, rose 27 per cent year over year in 2019. The 26,948 sales was about 10 per cent above the 10-year average.
The price per square foot of condos rose to $991 and the average unit size rose to 925 sq. ft.
A busier than usual December, saw 1,871 sales, a 132 per cent year over year jump that was 63 per cent above the 10-year average.
Altus Group’s annual survey of home-buying intentions, published Friday, showed fewer GTA households are expected to enter the market this year.
“Home-buying intentions among renters — the primary pool for potential first-time buyers — had shown some recovery in late 2018 yet softened again by late 2019,” said a news release on the company’s 2020 GTA Flash Report, an annual review and projection of the real estate market.
Households that already owned homes also said they were less likely to buy again this year, a fact attributed to home prices, which are rising again, after a market correction that started in 2017 and held through much of last year. Based on the Altus FIRM Survey, there is also growing uncertainty about employment and the economy, said the Altus report.
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About one in three renters under age 45 say they are saving for a down payment and only one in nine indicated they preferred renting to buying.
BILD CEO David Wilkes said the industry and governments have to transform the planning system to help expedite construction and address the region’s housing supply shortage.
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