Toronto’s detached real estate is having another rough month. Numbers from the Toronto Real Estate Board (TREB) show that buyer indecision provided substantial downward pressure to the detached segment in July. Generally speaking, detached units across TREB saw lower prices, less sales, and more inventory.
Prices Declined Up To $205,000 From Last Month
Detached prices remain in positive territory, but are showing pretty large drops. The benchmark price, the price of a typical detached home, fell to $963,900 across TREB, a 6.16% decline from the month before. Before you say crash, this price is still 14.93% higher than the same time last year. In the 416, the benchmark price for a detached fell to $1,146,100, a 4.9% decline from the month before. This is up 13.12% from the same time last year. Prices remain positive across TREB, but price gains are tapering quickly.
Breaking down the 416, every neighbourhood saw a decline from the month before – but some stand out. The Rexdale-Kipling neighbourhood (TREB W10) saw prices drop the least, with the price of a detached home now $748,500, a decline of $12,600 from the month before. One of the city’s most affluent neighbourhoods, Bayview Village/Hillcrest Village (TREB C15), saw the greatest declines. The benchmark price for a detached in that neighbourhood fell to $1,532,100, a $205,200 decline from the month before.
Detached Sales Are Down 47.4%
Sales showed large declines, posting the worst number for July in at least 5 years. TREB saw 2,434 sales, a 47.4% decline from the same time last year. The 905 logged 1,878 of those sales, a 48.9% decline. The 416 saw 556 sales, a 41.7% decline. Sales tend to taper as prices get higher, but this is a really large drop. To contrast, July 2016 also saw a decline from the previous year, but it was only 1.5%.
Detached Inventory Is Building
Inventory is soaring across the TREB, especially in the suburbs. The GTA saw 6,989 detached listings, a 10% increase from the same time last year. The 416 saw 1,282 new listings, a 27% increase from the same time last year. In terms of total inventory, the month ended with 10,497 active detached listings, a 120% increase from the same time last year. It’s too soon to call it a trend, but active detached listings have been significantly higher over the past three months than they have been over the past couple of years.
The city has been hit with a number of changes that impact the market, including the Ontario Fair Housing Plan, higher interest rates, and increased difficulty in obtaining mortgages. Historically, higher interest rates only impact the Canadian market for less than a year, but it’s tough to tell what the combination of factors will do. This really is a wait and see market, the best case scenario for homeowners being a repeat of Vancouver.