Toronto home sales defied the normal summer lull to soar in July, outpacing even June sales levels as buyers are increasingly overcoming tougher mortgage-qualification rules and returning to the market.
The Toronto Real Estate Board said 8,595 homes were sold in the Greater Toronto Area last month, a 24-per-cent increase over July last year, and a 5-per-cent increase over June after adjusting for seasonal variations.
With new listings slow to come onto the market, prices rose in July as demand outpaced supply. TREB said the average home price climbed by 3.2 per cent, with detached houses the only category of homes to not see a price increase last month.
Condominium prices rose 6.7 per cent to an average of $584,019, TREB reported, while semi-detached house prices climbed 5.3 per cent to an average of $786,974, and townhouse prices climbed 4.3 per cent to average $660,251.
However, detached house prices fell 0.9 per cent to an average of $995,043, even as the number of detached homes sold last month soared by almost 30 per cent compared with July, 2018. TREB said detached house prices still remain down from last year in many pockets of the GTA.
“Broadly speaking, increased competition between buyers for available properties has resulted in relatively strong price growth above the rate of inflation for semi-detached houses, townhouses and condominium apartments,” TREB chief market analyst Jason Mercer said in a statement.
“However, the single-detached market segment, which has arguably been impacted most by the OSFI stress test, has experienced a slower pace of price growth.”
TREB chief executive officer John DiMichele warned that larger price increases may be coming for the GTA because the region continues to have too little new supply of housing to meet market demand.
He said there is growing “pent-up demand” for housing as the number of households in the GTA continues to grow by 40,000 to 50,000 each year.
“As more and more households come to terms with the stress test and move back into the market in the coming months and years, they could suffer from a chronically under-supplied martketplace and an acceleration of home price growth to unsustainable levels,” he said in a statement.
The number of homes newly listed for sale in July rose 3.7 per cent during last year, an increase that did not keep pace with the 24-per-cent growth in sales last month. As a result, the number of active listings on the market as of July 30 was down over 9 per cent compared with the same date last year.