The Greater Toronto Real Estate Market is becoming more balanced as home sales in May fell 39 percent from a year earlier and prices rose nearly 10 percent, the Toronto Regional said on Friday. Real Estate Board.
The Ontario council found home sales last month to 7,283, down from 11,903 in May 2021 and 7,989 last April.
The council attributed the drop in sales to rising borrowing costs that materialized due to rising interest rates and joined inflationary pressures that weighed on spending.
However, the board found that buyers had more bargaining power last month as the market began to balance.
“After a strong start to the year, the current rate of tightening rates has changed the dynamics of the market, with many potential home buyers putting their purchase on hold,” said Jason Mercer, an analyst at market leader in TRREB, in a statement.
In recent weeks, real estate agents have noticed that the pace of sales is not as torrid as it was at the beginning of the year. Many sellers are now collecting fewer bids and bidding wars for their home, forcing some to accept a lower price than they could have seen months ago.
The average home price reached $ 1,212,806 in May, up nine percent from $ 1,108,124 in the same month last year.
However, the average home price was still below $ 1,253,567 in April.
“Now there is a psychological aspect where potential buyers are waiting for a low price. This is likely to continue over the summer, “TRREB President Kevin Crigger said in a statement.
The average price of a single-family home in the city of Toronto, which is linked to area code 416, rose 12 percent from last year to more than $ 1.9 million in May, while that semi-detached properties rose 8 percent to more than $ 1.4 million.
Townhomes rose about 10 percent to just over $ 1 million, while condominiums also rose 10 percent to an average of $ 793,000.
Single-family homes rose about eight percent to more than $ 1.4 million in 905, an area surrounding Toronto that includes towns like Vaughan, Mississauga and Brampton.
Townhouses and townhouses in the area increased by 14% each to more than $ 1 million and $ 950,000 respectively.
905 condominiums grew 20% to an average of $ 722,000.
The number of homes people had to choose from varied little from a year ago. May had 18,679 new listings, less than one percent compared to 18,593 in the same month last year.
Looking to the future, Crigger does not believe that the changing market will cause a drop in housing demand.
“As homebuyers adjust to higher borrowing costs, housing demand will be supported by extremely low unemployment, high job offers, rising incomes and record immigration.”
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