Last year, the Greater Toronto Area (GTA) new home market saw its lowest total sales in nearly two decades, according to the Building Industry and Land Development Association (BILD).
In 2018, there were 25,161 new homes sold in the GTA, according to Altus Group, BILD’s official source for new home market intelligence. This figure made 2018 the year with the lowest number of new home sales recorded in the GTA since 2000, when Altus Group began tracking new home data.
There were 21,330 condominium apartments sold in 2018, including units in low, medium and high-rise buildings, stacked townhouses and loft units, a decline of 38 per cent year-over-year, but only four per cent below the 10-year average. Meanwhile, 2018 only saw the sale of 3,831 single-family homes, including detached, linked and semi-detached houses and townhouses. This figure is 50 per cent below year-ago levels, and 74 per cent below the 10-year average.
“A number of factors combined to produce the drop in GTA new home sales in 2018,” said Patricia Arsenault, Altus Group’s executive vice president of data solutions, in a press release. “More stringent mortgage stress testing, rising interest rates and lack of single-family product affordable to a broader range of buyers all played a role. As well, the record new condo apartment sales in 2017 brought forward some demand that would otherwise have occurred in 2018.”
In December, the benchmark price for a new condominium apartment was $796,815, an increase of 11.2 per cent year-over-year, while the benchmark price for a single-family home was $1,143,505, down 6.7 per cent annually.
“From our point of view, the market is out of balance,” said David Wilkes, BILD’s president and CEO. “We must continue to work with all levels of government to ensure that policies don’t artificially price consumers out of the market.”
“We commend the provincial government for taking action toward increasing housing supply in Ontario,” added Wilkes. “We join other industry groups in calling on the federal government to revisit the stress test and allow a longer amortization period for first-time buyers. And we look forward to working with our municipal partners on removing barriers to development such as excessive red tape and outdated bylaws.”
At the end of December, there were 15,768 new homes available for purchase, broken down into 10,687 condo units and 5,081 single-family homes. These numbers include units in pre-construction projects, in projects currently under construction and in completed buildings.