Photo: James Bombales
Home sales and prices have been dropping across the GTA ever since January, with one exception — the condo market has remained surprisingly hot, reporting year-over-year price increases for five straight months.
The strength of the demand has been attributed to the relative affordability of condos. The average price of a Toronto detached home is still above the million dollar mark, while the average GTA condo price sits at just $563,892.
But, according to a new report from Zoocasa, higher priced condo sales are on the rise, while cheaper units have begun to fall by the wayside.
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“Unit sales in the price range of $500,000 to $799,999 have skyrocketed between 81 to 111 per cent over the last two years,” reads the report. “By comparison, sales of units at the lower end of the market (under $399,999) have plunged between 58 to 89 per cent over the same time period.”
Zoocasa attributes the jump in higher priced sales to a classic supply-and-demand problem. Demand has boosted condo prices 35 per cent over the past two years, while inventory has fallen 27.7 per cent over the same period.
And as more buyers look to replace their dreams of low-rise homeownership, higher priced units with dens and two bedrooms are in particularly high demand. At the same time, the challenge of solo buying could be the cause of the drop in lower-priced unit sales.
“[The decline in lower priced units] could be due to the growing challenge that is purchasing a home on a solo income,” reads the report. “According to StatsCan, the median single-income-earning household brings in $39,560 annually, qualifying for a maximum mortgage of $206,101.”
For a closer look at how condo sales (and prices) have changed over the past two years, check out the infographic below.