The GTA housing market just had its slowest April in 15 years
The Toronto Real Estate Board just released its monthly statistics for April, and although we’re still far from anything resembling an apocalyptic market crash, we’re also not yet in full recovery mode.
April is normally a big month for the Toronto real estate market. Sales tend to slow over the winter and accelerate during spring. This April was particularly anticipated because it marks one year since the GTA housing market began its downward trend, after the Ontario government introduced its Fair Housing Plan, a multi-pronged initiative that included a 15 per cent tax on housing purchases by foreign nationals. The downturn was exacerbated at the beginning of the year, when new, tighter federal mortgage rules came into effect. This is the first spring market since all the trouble began.
This year, as usual, April home sales were an improvement over the winter months. But anyone hoping for a dramatic early-spring recovery will be disappointed: this April was nothing compared to previous Aprils.
According to TREB, the number of home sales recorded throughout the Greater Toronto Area this April was 7,792. That’s down from 11,468 sales in April 2017, a 32.1 per cent year-over-year decline. The average price of a home in the GTA was down 12.4 per cent year-over-year, to $804,584.
In a press release, TREB president Tim Syrianos cautions against taking this decline too seriously. “The comparison of this year’s sales and price figures to last year’s record peak masks the fact that market conditions should support moderate increases in home prices as we move through the second half of the year,” he says. TREB’s seasonally adjusted numbers, which attempt to correct for seasonal market fluctuations, show sales and average prices as essentially flat over March and April. TREB also points out that the mix of housing types being sold is a factor here: high-end detached homes now make up a smaller percentage of sales than they did last year, and condo prices are still rising.
But April 2018 wasn’t just lacklustre in comparison to last year. The last time the GTA sold fewer than 8,000 homes in April was 15 years ago, in 2003. And the last time there was a year-over-year decline in April’s average sale price was in 2009, during the recession.
Recent buyers caught up in the sudden price swing have begun telling their stories to the press in the hopes of gaining some financial relief while they wait for the market to recover. They may need to keep waiting.