The end of summer housing report is here, and situation of supply continues to hunt house hunters. In 2020, the International Airport in Toronto nearly shutdown, reducing population growth. By the Summer of 2021, Pearson International Airport is only seeing 8% of the normal flight traffic. Meanwhile the demand of housing continues, due to the existing demand for affordable housing.
Toronto’s end-of-summer housing numbers are in, and reporting the third-best sales result on record for the month of August. While the market has taken its regular summer breather, it is clear that the demand for ownership housing remains strong.
With the lack of new housing, during the lockdown, this result in tighter market conditions and sustained competition between buyers, resulting in double-digit annual increases in selling prices.
We reported 8,596 sales through TRREB’s MLS® System in August 2021 – down by 19.9 per cent compared to the August 2020 record of 10,738. The condo apartment market segment bucked the overall sales trend, with year-over-year growth in sales, continuing a marked resurgence in 2021.
The number of new listings entered into the System was down year-over-year by 43 per cent. The fact that new listings were at the lowest level for the past decade is alarming. It is clear that the supply of homes is not keeping pace with demand, and this situation will become worse once immigration into Canada resumes.
The federal parties vying for office in the upcoming federal election have all made housing supply and affordability a focal point. Working with provincial and municipal levels of government on solving supply-related issues is much more important to affordability than interfering with consumer choice during the home buying and selling offer process or revisiting demand-side policies that will at best have a short-term impact on market conditions.
The average selling price for all homes combined was up by 12.6 per cent year-over-year to $1,070,911. The strongest annual rates of price growth are still being experienced for low-rise home types. However, average condo apartment price growth is now well-above inflation as well.
On a seasonally adjusted basis, the average selling price continued to trend upward in August. Sales have accounted for a much higher share of new listings this year compared to last, and the story was no different in August. There has been no relief on the supply side for home buyers, in fact, competition between these buyers have increased. As we move toward 2022, expect market conditions to become tighter as population growth in the GTA starts to trend back to pre-COVID levels.
With a federal election just weeks away, ensure your MPs continue focusing on housing policies that address supply and affordability across the country. Bold action, not promises, are needed to ensure that Toronto has a stable and sustainable housing market now and, in the decades, to come.