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Home sales in the Greater Toronto Area fell 35% in September compared with the same month last year, although the average selling price rose.

The Toronto Real Estate Board said Wednesday sales of all major types of residential property fell, but the biggest move was a 40.4% drop in sales of detached homes.

The average selling price for all types of property sold in September climbed 2.6% from a year ago, rising to $775,546.

The average price was also up 5.9% from $732,039 in August — the first month-over-month increase since April, when the average hit a record high of $918,285.

“With more balanced market conditions, the pace of year-over-year price growth was more moderate in September compared to a year ago,” said Jason Mercer, the board’s director of market analysis.

He added there was an exception in the condominium apartment market segment, where average and benchmark sales prices were up by more than 20% compared to last year.

The Toronto-area sales and price report comes a day after the Real Estate Board of Greater Vancouver reported strong demand for condos and townhouses in September.

Read: Will Toronto add new vacancy tax on rental properties?

The number of new listings in the Toronto on the Multiple Listing Service increased to 16,469 in September, up 9.4% from a year earlier, and the number of active listings increased by 69% from last year to 19,021.

“The improvement in listings in September compared to a year earlier suggests that homeowners are anticipating an uptick in sales activity as we move through the fall,” board president Tim Syrianos said in a statement.

A spike in Toronto-area home prices early this year resulted in the provincial government’s imposition of a number of measures to cool the overheated market after a shortage of detached home listings helped push up prices.

There have also been a number of warnings about the economic risk to Canada posed by high consumer debt, mostly due to mortgages.

Read: CMHC could make it easier for entrepreneurs to get mortgage insurance

The Toronto board said high-priced detached homes accounted for a smaller share of sales than in September 2016 The region’s average price for that category was flat at $1,015,067.

Meanwhile the average price for condos was up 23.2% to $520,411 and the average price for semi-detached houses was up 7.4% at $752,379.

Mortgage news

The head of Canada’s banking regulator says it will put forth updated mortgage underwriting guidelines by the end of the month.

Superintendent Jeremy Rudin said Tuesday that after the final version of changes to its B-20 guidelines are submitted, which included a stress test for uninsured mortgages, he expects them to come into force two or three months later.

“We clearly see the potential risks caused by high household indebtedness across Canada, and by high real estate prices in some markets,” the head of the Office of the Superintendent of Financial Institutions said during a speech to the Economic Club of Canada in Toronto.

“We are not waiting to see those risks crystallize in rising arrears and defaults before we act.”

In July, OSFI put forward for consultation a raft of proposed changes to mortgage underwriting guidelines, including a stress test for uninsured mortgages.

Rudin said Tuesday that the final version would be similar to what OSFI had outlined in its earlier proposal.

His comments come after the Ontario government moved to cool down the hot housing market with a host of measures in April.

Those actions included a foreign buyers tax, similar to one previously handed down in Vancouver.

Read: What 97% of homebuyers regret

Originally published on Advisor.ca
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