January 7, 2020 | Buying
The Toronto Real Estate Board reported a 17.4 per cent increase in residential sales year-over-year for December 2019. The 2019 calendar year reported 87,825 sales in total – up by 12.6 per cent compared to the decade low of 78,015 sales reported in 2018. As a result, 2019 sales were on par with the average annual sales result for the past decade. The MLS Home Price Index Composite Benchmark was up by 7.3 per cent in December 2019 year-over-year. From June 2019 onward, the annual growth rate in the MLS HPI Composite Benchmark accelerated.
A recovery in sales activity was definitely displayed in 2019, predominantly in the second half of the year. This market activity influenced many potential home buyers to become active once again in the spring after patiently sitting on the sidelines for the first half of the year. The strength of our regional economy assisted in building buyer’s confidence along with the decline in contract mortgage rates over the course of 2019.
Furthermore, we continued to observe the decline in the number of new listings entered into TREB’s MLS system in 2019. While sales figures proved to be on the rise in 2019, new listings were down by 2.4 per cent year-over-year. Over the past decade, annual new listings have maintained a holding pattern between 150,000 and 160,000, notwithstanding the overall increase in home prices over the same period of time.
At any rate, over the last decade, the housing supply issue within the GTA has drawn attention and concern. Progressively, conducted research, policymakers and other interested parties have conceded that the lack of supply within the Toronto real estate market in both ownership and rental housing has triggered a lack of housing affordability within the GTA. Consequently, observing 2019 for instance, the GTA experienced tighter market conditions due to the strength in sales increase directly competing with a decline in supply.
With this in mind, price growth within Toronto has accelerated and we can only anticipate further price acceleration in 2020 unless we witness an appropriate increase in new listings supply. The average selling price in December 2019 was $837,788 – up almost 12 per cent year over year. For 2019’s calendar year, the average selling price was $819,319 resulting in a 4 per cent increase.
With 2020 now in full swing, let’s see what new market this new decade brings. Looking to achieve a better understanding of the market? We interpret the data as it becomes available to determine how it will impact buyers and sellers. Get in touch to learn how our up-to-the-minute knowledge can help you meet your real estate goals. Contact us today!