Toronto housing prices hit new record with detached homes averaging $1.2 million — but downtown condos bucked the trend
Toronto area home prices and sales rose for the fourth consecutive month in October with the Toronto Regional Real Estate Board forecasting record or near-record sales to continue through the balance of the year.
But as detached house values have soared, a surge in condo supply has rendered prices in that category relatively flat, said the TRREB on Wednesday.
There were 7,441 detached houses listed last month, a year-over-year increase of 6.9 per cent.
Condo listings more than doubled to 6,193, compared to October 2019.
It’s a substantial turnaround from the 2017 and 2018 market, when the condo sector was among the tightest, said the board’s chief market analyst, Jason Mercer.
“We still are seeing sales up relative to what we saw last year. It’s not a scenario where sales and demand are drying up. It’s that buyers are benefiting from more choice and you would expect them to take advantage of that over time,” he said.
The average price for all resale houses and condos rose 13.7 per cent year over year, last month to $968,318.
Detached houses sold for $1.2 million on average, a 14.8-per-cent increase this year, compared to last October. Sales were up 33.9 per cent across the region for those houses.
Condo prices rose just 0.7 per cent, to an average of $622,122.
The strongest gains across all resale housing categories occurred in the 905 communities outside Toronto.
In the City of Toronto, condo sales actually fell 8.5 per cent, compared to last year, with prices staying about the same. Meantime, the 905 municipalities saw a 28.4-per-cent rise in condo sales and a 6.8-per-cent gain in the average price.
The 905 also saw the greatest growth in detached house sales, up 39 per cent, compared to 19.6 per cent in the City of Toronto.
In the 905 areas, house prices rose 18 per cent to $1.12 million.
But inside Toronto’s borders detached house prices grew 11.2 per cent with an average selling price of $1.47 million.
“The market’s tightened a lot in comparison to last year if you’re out there looking to purchase a detached home. Whereas in the condominium market, if you’re a buyer, you’re benefiting from quite a bit more choice,” said Jason Mercer, the real estate board’s chief market analyst.
Even pre-COVID-19, the real estate board’s Ipsos polling suggested condo listings would rise in 2020, said Mercer.
“Some investors were looking at a little less flexibility around their investment and had seen a good return on their investment, at least on paper, over the last few years. That may have prompted some thought of listing,” he said.
Added to that, the renting population saw heavier job losses and less job recovery through the spring and summer.
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Mercer also noted that investor owners of short-term rental condos faced new regulations this year and tourism dried up. On the long-term market, there have been no temporary migrants to contribute to the renting population.
But that doesn’t mean the condo market won’t tighten up in the future, he said.
“Longer term, the federal government’s announced target for immigration — it is looking at 400,000-plus per year (for the next three years) — the GTA’s always been a large beneficiary of that,” said Mercer. “On top of that, you would expect to see non-permanent migration pick up in a post-COVID-19 period.”