The 2018 Greater Toronto Area housing market had a rough start. A new stress test was introduced on January 1 of last year, reducing affordability for borrowers, while 2017 provincial regulations were still causing confusion among both buyers and sellers, and the Bank of Canada hiked interest rates.
While the market largely picked up in the latter half of the year, the damage was already done. All three key metrics reported by the Toronto Real Estate Board – price, sales and new listings – were down compared to 2017.
The overall average selling price for 2018 transactions slid 4.3 per cent to $787,300 across TREB’s region while sales sank 16 per cent to 77,426 reported transactions. Total new listings were down by 12.7 per cent to 155,823.
“After spiking in 2017, new listings receded markedly in 2018. In many neighbourhoods, despite fewer sales from a historic perspective, some buyers still struggled to find a home
meeting their needs. The result was a resumption of a moderate year-over-year pace of home price growth in the second half of the year,” says Jason Mercer, TREB’s director of market analysis.
Of course, this slight downturn should be kept in perspective. Although 2017 may have represented a high in the Toronto real estate market, 2018 prices still rose almost 8 per cent from 2016, and an incredible 107.5 per cent in the last decade (homes were just $380,000 in 2008’s Toronto).
The real story of 2018 was the sustained rise in condo prices — in many months the only market segment to show any significant year-over-year price growth at all. In fact, the only reason the City of Toronto showed growth in their year-over-year overall housing prices while the 905 had a decline was because of brisk condo sales.
(Condo sales accounted for 30 per cent of overall sales across TREB, but the majority of those took place in 416. The 905 mostly has detached homes for sale, not only in the popular Halton region like Burlington homes for sale and Oakville homes for sale, but also across Durham, Dufferin County, Simcoe County, Halton Region, and even in Peel and York.)
In the same year that condo prices rose 8 per cent, detached houses plunged 8 per cent — perhaps indicating that
Torontonians are still set on home ownership, but are moving into lower-prices market segments.
A single-family home in 2018 was $90,000 less than in 2017 — but remains over $1 million, leaving it far out of reach of most Toronto buyers.
As for December itself, it was largely consistent with the story we’ve seen play out across 2018: a growth in condo prices, up 10 per cent to $554,500, a slide in detached houses, down 4.4 per cent to $945,600 and a massive slowdown in sales, down 22.5 per cent overall.
Check out the infographic below for more details on what happened to the Toronto housing market in December:
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