The Greater Toronto Area housing market quickly transitioned from summer into a typically-busy fall season during September according to the latest insights published today by the Toronto Regional Real Estate Board (TRREB).
After Labour Day — a holiday that is considered to be the unofficial end of summer — the Toronto region usually sees an increase in property sales, average selling prices and listings. September 2021 was no different than the norm, but high demand and lower levels of new inventory is keeping market conditions tight.
Here’s what we know about the latest from TRREB:
September 2021 marks third-best September on record
In September, 9,046 sales were logged through MLS, making it the third-highest mark on record for the month of September. The 905 area of the GTA represented the majority of the sales, with 5,649 transactions.
On an annual basis, September sales were down 18 per cent from 2020’s record-breaking levels. This is mostly due to the lower quantities of new listings, which TRREB says have dropped 34 per cent year-over-year. Last month was also “up in line with the regular seasonal trend from August,” according to TRREB.
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Compared to 2020, market conditions have been noticeably tighter, with the number of sales representing a substantially higher share of listings as the quantity of new homes coming online remains significantly lower. TRREB attributed a resurgence in the condo market as a factor behind the higher share of listings sold during September.
A total of 3,908 detached listings were sold last month, down 29.3 per cent from last year. Meanwhile, the 2,664 condo apartments that were sold represented a 13 percent increase from 2020.
New listings drop sharply from 2020 levels
Across the GTA, 13,483 new listings were added to the market last month, approximately 7,000 less from the 20,441 homes that came online during the same period last year.
The majority of listings that became available in September were recorded in the 905 area, with 7,537 new properties.
“With new listings in September down by one third compared to last year, purchasing a home for many is easier said than done,” said TRREB’s president, Kevin Crigger. “The lack of housing supply and choice has reached a critical juncture.”
Average prices rose annually and month-to-month
Home prices continued to make substantial gains last month.
For all home types, the average selling price was up 18.3 per cent year-over-year to $1,136,280 in the GTA. In August, the average price was $1,070,911, representing a monthly growth rate of six per cent. The MLS Home Price Index Composite Benchmark also grew 19.1 per cent yearly during September.
The average price for a home in the 905 area is $1,163,992, higher than the City of Toronto, where prices are currently $1,090,196. Detached property types within the 416 area are the priciest on the market, having grown 19.5 per cent annually in value to an average of $1,778,928 .
Jason Mercer, TRREB’s chief market analyst, pointed out that last month’s price growth was supported by the low-rise market segments, which includes detached, semi-detached and townhome properties.
“However, competition between buyers for condo apartments has picked up markedly over the past year, which has led to an acceleration in price growth over the past few months as first-time buyers re-entered the ownership market,” he said. “Look for this trend to continue.”
Local elections are on the horizon, creating potential for housing policies
Crigger explained in September’s report that “Band Aid policies” to suppress demand “have not been effective,” and stated that there needs to be a collaborative approach between the three levels of government.
With the housing crisis having played a crucial role in the recent federal election, the topic will likely face debate again in the upcoming provincial and municipal elections slated for 2022, explained TRREB CEO John DiMichele.
“Much of the heavy lifting required to bring more housing online, from a policy perspective, happens at the provincial and local levels,” he said in the report. “These levels of government need to be on the same page. This should be an important topic for debate during the upcoming elections.”