Greater Toronto, September 25, 2017 – Sales of new construction homes in the GTA were down in August, but the year-to-date sales are still very strong, the Building Industry and Land Development Association (BILD) announced today.
There were just 795 new homes sold in August, according to Altus Group, BILD’s official source for new-home market intelligence. Low-rise single-family homes, which include detached and semi-detached houses as well as townhomes, accounted for only 114 of the homes sold, while 681 were multi-family homes, condo apartments in high-rise and mid-rise buildings and stacked townhomes.
BILD President and CEO Bryan Tuckey said August is typically a slow month and cautioned against reading too much into the drop. “One month does not a trend make. Late summer is a quiet time for real estate, and most builders wait until September to launch developments and bring new product to market,” said Tuckey. “We are expecting fall to be very busy, and 2017 could still be a record year of new home sales driven by the incredibly strong condo market.”
While August sales were down 69 per cent from August 2016 and 62 per cent below the 10 year average, year-to-date sales are still ahead of last year at this point and 28 per cent above the 10 year average.
The overwhelming majority of the 31,749 new homes purchased so far this year were multi-family units, condo apartments in high-rise and mid-rise buildings and stacked townhomes. Just 20 per cent of year- to-date sales were low-rise single-family homes.
“The longer-term decline in single-family’s share of new home sales has now kicked into hyperdrive – dropping from about one-half in 2015, to one-third last year, to less than one-sixth in recent months,” said Patricia Arsenault, Altus Group’s Executive Vice President of Research Consulting Services. “While underlying demand suggests the pendulum should start to swing back a bit towards the single-family side, in reality it will be stopped in its tracks unless there is a significant increase in new single-family product making it to the market.”
The supply of new housing increased marginally in August, but it is still far below what is considered a healthy level. At the end of August there were 6,608 multi-family homes and 1,880 single-family low-rise homes available for purchase in builders’ inventories.
With the small increase in the supply of homes available in builders’ inventories there was a corresponding slight decrease in prices. The average price for available new single-family low-rise homes was $1,289,298, down from July’s $1,316,693. However that is still 38 per cent more than a year ago when the average price was $931,506.
The average price of available multi-family homes in the GTA in August was $644,327, down from July’s average of $665,041, but still 34 per cent more than a year ago.
The price decrease for available new condo apartments in the GTA was due to slight declines in both the average unit size and the price per square foot of available units. The average unit size in August was 859 square feet, whereas in July it was 871 square feet. The average price per square foot was $750, down from July’s $764. In August 2016, the average price per square foot was $595 and the average unit size was 808 square feet.