The Toronto Greater Housing Market is becoming more balanced as home sales fell 39 percent in May from a year earlier and prices rose nearly 10 percent, the Toronto Regional Real Estate Board said Friday. .
The Ontario board found that home sales last month were 7,283, down from 11,903 in May 2021 and 7,989 last April.
The board attributed the decline in sales to higher borrowing costs, which materialized due to rising interest rates and were combined with inflationary pressures that weighed on costs.
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 cycle of tightening interest rates has changed market dynamics, with many potential home buyers postponing their purchase,” Jason Mercer, TRREB’s chief market analyst, said in a statement.
In recent weeks, brokers have noticed that the pace of sales is not as rapid as it was at the beginning of the year. Many sellers are now collecting fewer bids and bidding wars for their homes, forcing some to accept a lower price than they may have seen months ago.
The average home price reached $ 1,212,806 in May, up more than nine percent from $ 1,128,124 in the same month last year.
However, the average home price was still lower than $ 1,253,567 in April.
“Now there is a psychological aspect in which potential buyers are waiting for the bottom of the price. That is likely to continue over the summer, “said Kevin Krieger, president of TRREB, 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 last year to more than $ 1.9 million in May, while two-story properties rose about eight percent to more than $ 1 million. , $ 4 million.
Townhouses rose about 10 percent to a total of just over $ 1 million, while apartments also rose 10 percent to an average of $ 793,000.
Detached homes rose about eight percent to more than $ 1.4 million in 905, an area around Toronto that includes municipalities such as Vaughan, Mississauga and Brampton.
Two-family properties and townhouses in the area rose 14 percent each, reaching more than $ 1 million and $ 950,000, respectively.
Accommodation in 905 rose 20 percent to an average of $ 722,000.
The number of homes people had to choose from had changed slightly since a year ago. 18,679 new ads appeared in May, down from 18,593 in the same month last year.
Looking ahead, Krieger does not believe that the changing market will cause a drop in demand for housing.
“As home buyers adjust to higher borrowing costs, demand for housing will be supported by extremely low unemployment, high vacancies, rising incomes and record immigration.
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