In April, demand for new homes in the GTA continued to outpace supply, driving up prices for all types of available new homes, says the Building Industry and Land Development Association (BILD).
There were 4,680 new homes sold in the GTA in April, up seven per cent from one year ago, according to Altus Group, BILD’s official source for new home market intelligence. According to year-to-date sales data, in the first four months of this year, 17,977 new homes were sold, which is an increase of 24 per cent compared to the same period in 2016 and 48 per cent above the 10-year average.
The supply of new homes, however, continued to decline. At the end of April, there were only 9,387 new homes available to buyers across the entire GTA, marking the first time that inventory has dropped below 10,000 units in over a decade. One year ago, there were 21,056 new homes available for purchase in builders’ inventories.
“Builders are not able to keep up with the demand for new housing,” said Bryan Tuckey, BILD president and CEO, in a press release. “The product that builders are able to bring to the market is quickly purchased and prices for all types of new homes keep increasing as a result.”
In April, the average price of available new low-rise single-family homes, which includes detached, semi-detached and townhomes, climbed 40 per cent year-over-year to reach $1,212,297. The average asking price for available new detached homes in the GTA last month was $1,810,232, while the average price for an available semi-detached home was $856,036 and for townhomes was $946,496.
Prices of available new multi-family homes, condo apartments in high rise and mid-rise buildings and stacked townhomes jumped 24 per cent over the last year. The average price of available units reached $570,226 in April, with the average price per square foot at $685, and the average unit size at 832 square feet.
Prices of available condominium apartments climbed due to both an increase in average unit size and a significant increase in average price per square foot, which climbed 17.5 per cent compared to April 2016.
“The declining number of new homes available to purchase is not a question of less product being brought to market,” said Patricia Arsenault, Altus Group’s executive vice president of research consulting services. “There were more than 11,000 units in projects opened in the first four months of this year – that’s about one-third higher than the average for the previous two years. But new product is selling well. For example, for projects opened in the first quarter of this year, only one in five units were still available to purchase at the end of April; for the same period in 2015, that proportion was about double (two in five).”
According to BILD, about 70 per cent of the new homes that were purchased in April in the GTA (3,265 units) were multi-family condominium apartments in high-rise, mid-rise or stacked townhomes, which 30 per cent (1,415 units) were new single-family low-rise homes including detached, semi-detached and townhouses.
Single-family low-rise sales fell 39 per cent from one year ago while sales of multi-family condo apartments climbed 61 per cent compared to April 2016.