Toronto didn’t follow the bad news from Vancouver for at least November. Earlier this month we went through the latest Toronto Real Estate Board (TREB) release that showed the city had another stellar month. Today we’ll be diving a little deeper into how single family detached homes have been doing in the city. According to the latest stats package prices, sales, and absorption all increased.
The average benchmark price for detached homes are up again across the Greater Toronto Area (GTA). The average of the whole GTA was up 2.3% to $1,058,273, which is more than 27% from last year at this time. While the whole region performed better than industry average, the City of Toronto outperformed the average of the rest of the TREB region.
The 416 saw the detached benchmark average price rise to $1,345,962, a 3% increase over the past year. That works out to an increase of 32.3%, or $327,341 from the year prior. The 905 saw an average detatched go for $957,517 – a 25.5% increase over the past 12 months.
Toronto Detached Home Prices
Sales Grew Faster Than Listings
Resales of detached homes are experiencing the expected seasonal slowdown, but are up from last year. November 2016 saw 3,890 sales, a 12% increase from the year before. Combined with the 24% decrease in listings, this might be an explanation as to why people are paying more than the year prior. The number of days on the market also decreased by 24% from last year this time, to 17 days.
Whether you agree or not with prices moving up, less inventory and more sales usually lead sellers to ask for more. Likely a part of the reason the average detached home sold 2% over ask.
Toronto Detached Sales vs. Listings
Absorption Is Higher
Sales are up, listings are down – which means absorption is going to be higher. The number of new listings absorbed by the market increased 4% from last month to 48% – a whopping 29% change from last year. Generally speaking, it’s a buyer’s market if absorption falls below 10% (which is pretty far off), and it’s a seller’s market above 20%. If you’re new to the homebuying game, the former means prices should decrease, and the latter means prices will increase.
Toronto Detached Absorption
Speculative markets move irrationally to absorption. For example, Vancouver is seeing falling prices for single family detached homes, while absorption remains well above Toronto.
The latest report seems to indicate that single family homes are still very much in demand, and there’s little to indicate a Vancouver style drop soon. Doesn’t mean it can’t happen, but it does mean there’s little in this report that indicates it will.
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Photo: André Carrotflower