It?s promising to be a super-charged winter and spring homebuying season for Toronto, as buyer demand continues to rise, pulling prices up along with it.
The Toronto Region Real Estate Board (TRREB) released its robust February sales and pricing data this Wednesday. The results were a relief for many real estate industry professionals who were heartened by the 45.6 percent home sales increase achieved when compared to the same month a year ago.
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Across the Greater Toronto Area, 7,256 homes were sold, a huge rebound over February 2019?s decade-low result, but still short of the record number of homes sold for the month in 2017.
TRREB President Michael Collins said that the early-year results are a bellwether for the rest of the year.
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?Sales growth will be strong this year. TRREB?s forecast published in its Market Year in Review and Outlook Report on February 6, is calling for 97,000 sales in 2020,? said Collins in a media release.
?However, the annual pace of sales growth experienced in February will likely not be sustained throughout the year, because we will be making comparisons to much stronger sales results reported after the first quarter of 2019.?
It?s been an eventful week for Toronto housing market observers. The TRREB data was released on the same day that the Bank of Canada announced it was slashing its overnight rate by 50 basis points. The cut, in large part a response to the increasingly dire coronavirus outbreak, marked the first time the central bank moved the mortgage-market influencing rate in 17 months.
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The central bank?s move will likely push already-low Canadian mortgage rates further down for months to come, stoking demand in the Toronto market as homebuyers step off the sidelines and take advantage of the lower rates.
This eagerness on the part of homebuyers to jump into the market may end up exacerbating the already low supply of homes for sale in the GTA. According to TRREB?s February data, new listings only rose 8 percent when compared to 2019. Paired with the brisk pace of home sales and continually rising buyer demand, price spikes seem inevitable.
Tight market conditions have already led to home prices picking up steam in February, with the average selling price for all home types across the GTA increasing by 16.7 percent to $910,290.
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TRREB?s CEO John DiMichele highlighted the need to boost home supply in order to combat worsening housing affordability in the region.
?Sales growth well in excess of listings growth is once again the norm. This is because the temporary effects of the 2017 Ontario Fair Housing Plan and the OSFI mortgage stress test have largely worn off,? said DiMichele.
?However, while these policies were running their course, the well-publicized housing supply problem in the GTA continued unabated. All levels of government have acknowledged the supply problem, but we need to very quickly move from policy briefs to shovels in the ground.?