WATCH: Mark McAllister explains why real estate sales in the GTA are surging, along with home prices.
TORONTO – Home sales in Toronto aren’t slowing down.
A total of 88,462 homes were sold through the first 11 months of 2014 up 6.6 per cent from 2013. That number comes with a few thousand of the record set in 2007 when 93,193 homes were sold as buyers tried to get ahead of the land transfer tax which would take effect in 2008.
“You saw a lot of people who were jumping into the market to get ahead of the land transfer tax. The second land transfer tax in the city of Toronto,” Jason Mercer, the director of market analysis at the Toronto Real Estate Board said in an interview Tuesday. “So that prompted a lot of household to pull forward their buying decision so we saw a real spike in sales In the second half of that year.”
Sales dipped the next year but rebounded, and with the exception of 2008, have been in the mid-to-high 80,000s every year since.
The increase has been driven in large part by condo sales which have spiked 11.6 per cent since Nov. 2013. Mercer says first-time buyers see condos as the most affordable option.
And the price of a home inside the 416 isn’t going anywhere but up. The average cost of a detached home in Toronto in Nov. 2014 was $935,122 up 9.4 per cent from 2013. A semi-detached home rose 4.2 per cent to just over $660,000, a townhouse rose 6.3 per cent to just over $500,000 and a condo rose 2 per cent to over $394,000.
The skyrocketing prices are driven in large part by a decrease in market supply, Mercer said. More and more people are moving into the city but the number of detached homes being sold in Toronto is falling, causing the price for each one to increase.
Mark McLean, the creative director of Bosley Real Estate said the city’s real estate market is driven in large part by affordability, low interest rates and more people moving to the city.
“Certainly we’re dealing with the issue that there’s just no product on the market and that’s making people anxious to get in,” he said.
He expects sales to continue on the record pace once more condos and homes hit the market in the Spring.
– With files from The Canadian Press