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Toronto Loft Conversions

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Modern Toronto Lofts

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Unique Toronto Homes

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Condos in Toronto

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Toronto Real Estate

Toronto Real Estate

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Tag Archives: new mortgage

Toronto real estate prices jump with condos helping rise in sales

Susan Pigg – Toronto Star

It’s been a surprisingly hot summer for real estate across the GTA, with sales up 21% in August over a year earlier, according to figures released by the Toronto Real Estate Board Thursday.

Prices have also rebounded, in defiance of naysayers who, for more than a year now, have been anticipating a market crash. The average GTA sale price in August was $503,094, up almost 5.5% from a year ago.

Comment: But that is because the naysayers had been misreading, or deliberately misusing, the decline that was OBVIOUSLY connected to the new mortgage rules to advance a negative agenda.

Even Vancouver, which suffered the brunt of the slowdown that started in spring of 2012 and accelerated when tougher mortgage lending rules were imposed by Ottawa a few weeks later, saw a dramatic surge in sales.

Transactions were up 52% in August, although prices remain slightly below year-ago levels in what has long been Canada’s hottest, and priciest, housing market.

Comment: Priciest certainly, but Toronto has been hotter for years.

Some of the strongest growth numbers were seen in Toronto’s beleaguered condo sector last month where sales were up 20.1% across the GTA – 21.4% in the City of Toronto – and prices climbed by 3.7% year over year.

Comment: So that should put the final nail in the coffin of all the condo bubble talk. Just wait until we see the huge buildin permit numbers!

TREB attributed the sales increases to the fact that buyers have now adjusted to the more stringent lending rules, saved up bigger deposits and “have reactivated their search for a home.”

Comment: Yup, that about sums it up. And we have months with the same mortgage rules to compare. The 12 months from last July to this July were unfairly skewed, as sales fell due to the new rules. But we were comparing them to higher months – with different rules. Now, it is all apples to apples. But TREB is just echoing what I have been saying for months would happen, and for the same reasons I stated.

But there are other factors at play as well: There is growing confidence, although still considerable wariness, that the market is holding up far better than most observers had expected a year ago.

House hunters have also grown anxious that prices have only continued to climb while they’ve been watching from the sidelines since last summer.

Comment: I feel so bad for those who believed all the idiots who called for prices to fall. They saw prices rise 4-7% during that time, and mortgage rates also rose 0.60%. Everyone who told people to wait, prices would drop, they owe these people. Between prices and interest rates, they are now paying $200-300/month more than if they had bought 6-12 months ago. Great advice… Like I always say, the best time to buy is yesterday. Prices and rates only ever rise over time, waiting is NEVER your best strategy.

Also adding to that anxiety has been the unexpectedly strong rise in bond yields since June and, with them, fixed-rate mortgage rates. That has pushed more buyers to get out there looking before their 90- to 120-day rate guarantees from lenders run out.

The weather may also have been a factor. The normally peak spring market was held back this year across the GTA because of the winter that never seemed to end. Realtors had been anticipating that pent-up demand could push up sales well into the fall as a result.

The surge in buyers, coupled with the lack of enough properties for sale on the market to feed demand – a challenge that has dogged the GTA market for more than three years now – is “expected to promote continued price growth through the remainder of 2013,” says Jason Mercer, senior manager of market analysis for TREB.

Sales of detached homes were up 24.2% in August, year over year, across the GTA, according to TREB. The average sale price hit $783,708 in the City of Toronto and $590,583 in the 905 regions.

Condo sales rebounded by 21.4% in the City of Toronto and 16.9% in the 905 regions. Prices were up 3.7% overall, with the biggest increases in the 905 regions (up 7.1% to an average of $293,825) compared to a 2.3% increase in the City of Toronto where prices in August averaged $357,572.

Semi-detached sales were up 7.4% in the city and 16.5% in the suburbs, with sales prices averaging $576,022 (up 8.7%) and $409,322 (up 5.1%) respectively.

Townhouses saw sales climb by 17.6% across the GTA, 12.6% in the city and 19.2% in the 905 regions. Prices were down just under one% in the City of Toronto, to an average of $416,463, while they were up 6.7% in the 905 regions to an average of $374,494.

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Contact Laurin Jeffrey for more information – 416-388-1960

Laurin Jeffrey is a Toronto Realtor with Century 21 Regal Realty. He did not
write these articles, he just reproduces them here for people who are
interested in Toronto real estate. He does not work for any builders.

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