The Toronto Regional Real Estate board says August home sales slowed from the frenzied pace seen earlier in the year, but market conditions have tightened as supply plummeted by 43% and prices rose yet again.
The board said Friday that 8,596 homes were sold in August, a 19.9% drop from 10,738 at the same time last year and an eight% fall from 9,368 in July.
New listings in the region fell to 10,609. That was down 43% from 18,599 last August and 15% from 12,551 in July.
“Most of my sellers and most of my buyers just decided to go on holiday or said we will take a pause and we’ll pick back up in the fall, which is a classic Toronto real estate vibe in August,” said Jenny Simon, an agent with Re/Max Hallmark Richards Group Realty in Toronto.
The drop in supply was so dramatic in part because sales broke with tradition last year and were unusually high last August, she said.
Those conditions kept up and the region rang in the new year with homes changing hands at an eye-popping speed as buyers raced to take advantage of low interest rates.
As the year progressed, the pace of sales slowed, but the market has remained heated with bidding wars still the norm and fewer people putting their homes up for sale.
“Most houses right now that I am looking at have 10+ offers on them and that’s in any price point,” Simon said.
“There is still a huge demand for any type of house right now.”
Prices have also continued to climb — even in rural and suburban corners of the region — as remote work became more common and the closures of many businesses during Covid-19 helped people save money for homes.
The average price of a home in the region increased to $1,070,911 in August from $951,219 at the same time the year before and $1,062,256 the month before.
While areas surrounding Toronto, known as the 905, were once known to have slightly lower prices than the city, TRREB said the average cost of a home there hit $1,108,981 in August, up from $923,204 the year before.
The average price of a Toronto home was $1,000,008 in August, down from $1,012,817 the year before.
TRREB believes this pattern won’t end soon and the market will remain in favour of sellers.
It predicted in February that by the time 2021 ends, the average selling price in the region will be $1.025 million, up from an average $929,692 in 2020.
The Canadian Real Estate Association forecast in May that average home prices across the country would soar to as much as $649,400 by the end of the year and reach as high as $704,900 in 2023.
“There has been no relief on the supply side for homebuyers, in fact, competition between these buyers have increased,” said TRREB’s chief market analyst Jason Mercer, in a statement.
“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.”
Simon agrees. She predicts buyers continuing to outpace supply, even as more homes get listed in fall.
“There’s going to be more inventory, but I don’t think it’s going to be flooded,” she said.
“I think we’re still going to be looking at multiple offers and I think it’s just going to continue.”