Photo: Spiroview Inc. / Adobe Stock
Homebuyers looking in the Greater Toronto Area are no stranger to high prices. Since the COVID-19 pandemic started more than two years ago, prices in Toronto alone have increased over 20 per cent.
Yet, as the market hits peak springtime, communities across the Toronto region are actually noticing that home prices are trending downward.
New data released by HouseSigma shows that GTA home prices have been cooling from their record February numbers over the past several weeks.
From February to April 19th, the median sold price of a freehold townhouse fell the most compared to other property types, decreasing 22.6 per cent from $1.24 million to $960,000.
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Median sold prices for GTA detached and semi-detached properties dropped at a similar pace from February to April, decreasing 12.1 per cent and 13.5 per cent over the near two-month period down to $1.45 million and $1.15 million, respectively. Between February and April, median sold prices for GTA condos reported the smallest decrease, falling 6.8 per cent from $740,000 to $690,000.
By community, some of the most notable price declines were noted in municipalities surrounding the City of Toronto. Located at the top of the GTA, Brock saw the median price of a detached home fall 29.25 per cent between February and April, an approximately $310,000 difference as prices dropped from $1.06 million to $750,000.
Similarly, median prices were down 20.98 per cent, 19.44 per cent and 15.9 per cent in Georgina, East Gwillimbury and King. In the GTA’s larger communities — Toronto, Mississauga and Markham — median prices dropped 9.08 per cent, 11.1 per cent and 11 per cent over the almost two-month timeline.
In all of the 25 communities HouseSigma analyzed in its report, prices grew in only one municipality. From February to April 19th, the median price of a detached house in Burlington increased from $1.56 million to $1.59 million, a 1.92 per cent jump.
While the selling price of homes have dropped, GTA properties are now spending double the amount of time on the market. When aggregated, the median number of days a Toronto home stays available for sale has increased from six days in February to 12 days in April.
Hungry home buyers might also be happy to have more selection now compared to a couple of months ago. The number of properties available for sale on the market rose from 6,886 homes in February to 12,120 properties in April.
In a recent RBC Economics report, Robert Hogue, RBC’s assistant chief economist, said that deteriorating affordability and higher interest rates would help to curve home prices, predicting that prices will peak this spring before weakening throughout the year. That said, stronger-than-expected gains made in 2022 so far will hike the annual average price for 2022 higher than predicted, up 8.1 per cent compared to 6.2 per cent. However, the 2023 annual average will likely fall 2.2 per cent instead of rising 0.8 per cent like initially predicted.
Compared to other markets, Canada’s most expensive communities — like Toronto — will feel the pain of rising rates the most.
“This will translate into larger annual price declines in 2023 in British Columbia and Ontario,” said Hogue. “By comparison, we expect activity and prices to be more resilient in Alberta, where local markets have more catching up to do following a prolonged slump before the pandemic.”