Although home sales across the Toronto region continue to fall from their March 2021 market peak, the Toronto Regional Real Estate Board (TRREB) has revised its initial forecast for 2021 sales and prices upward.
Last month, 11,106 sales were reported in the Greater Toronto Area, a 28.5 percent increase compared to June 2020, according to new market data published by TRREB in a news release today. However, on a month-to-month basis, actual and seasonally-adjusted sales trended lower in June, the report said. In May, TRREB reported 11,951 total sales.
“We have seen market activity transition from a record pace to a robust pace over the last three months,” said Kevin Crigger, President of TRREB, in the news release. “While this could provide some relief for home buyers in the near term, a resumption of population growth based on immigration is only months away.”
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The average selling price for all property types in the GTA was up by 17 percent annually in June to $1,089,536. Similarly, the June 2021 MLS Home Price Index composite benchmark climbed 19.9 percent year-over-year. Yet, actual and seasonally-adjusted average prices also drifted lower last month, the release said.
In the GTA, detached properties led the way with the highest levels of price growth, rising by 24.8 percent annually to $1,407,540. The ‘905’ area in particular saw average prices jump by 29.4 percent year-over-year to $1,329,873.
Although price growth was primarily driven by the low-rise segment of the market, the average price of a condominium apartment in the ‘905’ and ‘416’ regions was up by 8.3 percent annually to $683,479. Within the GTA, the condominium apartment segment also reported its strongest year-over-year sales growth with 2,800 transactions logged between the two regions — a 57 percent annual increase.
The release noted that in all major market segments, year-over-year sales growth outpaced the number of new listings during the same time period. This illustrates the ongoing tight market conditions, which have spurred fierce buyer competition and rising home prices. Across the GTA, there were 16,189 new listings in June. A month prior, TRREB reported 18,586 new listings in the GTA for the month of May.
In its initial forecast for 2021 that was released in early February, TRREB anticipated that the region would see 105,000 home sales with an average selling price of $1,025,000. TRREB’s early predictions were supported by the improving regional economy and high demand fueled by low borrowing costs, which were expected to “ebb” in 2021 due to stalled population growth caused by the COVID-19 pandemic, the release explained.
Although sales appear to have peaked this year, TRREB says that activity in the first quarter of 2021 was busier than expected, with March setting an all-time record of over 15,000 home sales. Given the first quarter’s stellar sales numbers, and the expectation that sales will trend below record levels for the rest of 2021, TRREB has revised its forecast to 115,000 transactions and hiked the average selling price to $1,070,000.
Jason Mercer, TRREB’s Chief Market Analyst, noted that the record pace of sales has “run its course” with pent-up demand becoming increasingly satisfied despite lower levels of population growth.
“With this said, a persistent lack of inventory across most segments of the market will keep competition between buyers strong, resulting in an average selling price well above $1 million through the end of 2021,” he said.