The GTA new home market was quiet in August as potential home buyers waited on the sidelines, according to the Building Industry and Land Development Association (BILD).
There were a total of 974 new home sales in August, according to Altus Group, BILD’s official source for new home market intelligence. There were 171 single-family homes sold during the month, including detached, linked and semi-detached houses and townhouses (excluding stacked townhouses), an increase of 50 per cent in this category compared to last August, but down 80 per cent from the 10-year average.
Condominium apartments in low, medium and high-rise buildings, stacked townhouses and loft units accounted for 803 new home sales, a decline of one per cent year-over-year and 28 per cent below the 10-year average.
According to Patricia Arsenault, Altus Group’s executive vice-president, data solutions, August’s slow sales should not be interpreted as a sign of low buying interest in the GTA. “Pent-up demand is forming, which suggests we should see sales start to firm up this fall,” she said, in a press release.
Many potential new home buyers are choosing to wait and see what happens following government interventions to cool the housing market and concerns about the future direction of the economy, according to David Wilkes, BILD president and CEO.
“Once the market adjusts and more people start looking for homes, our region’s short supply of housing will mean that affordability will continue to be a challenge for many new home buyers,” said Wilkes.
In August, the benchmark price of a new condominium apartment climbed 21.8 per cent year-over-year to $784,512. The benchmark price of new single-family homes was $1,129,129, a decline of 12.4 per cent year-over-year.
Since only two projects opened in August, the remaining new home inventory fell to 13,619 units, comprised of 8,842 condominium apartment units and 4,777 single-family units. Remaining inventory includes units in preconstruction projects, in projects currently under construction, and in completed buildings.
According to Wilkes, to solve the challenges facing the GTA housing market, governments must address housing supply. “Municipal governments, in particular, can make a big difference. Ahead of the municipal elections in the GTA, BILD has been talking to municipal leaders and residents about straightforward steps that municipalities can take to increase housing supply, including making sure that government charges on new homes are fair, funding and building critical infrastructure, cutting red tape and speeding up building permits and inspections,” he said.