GTA Housing Market in May 2021; Sellers Dominated the Market

The Toronto Regional Real Estate Board (TRREB) reports that the number of house sales in the Greater Toronto Area (GTA) has decreased for the second month in a row, following many months of frenetic activity. Despite an apparent cooling in the market, the 11,951 sales in May 2021 were more than twice of May 2020, when the pandemic was just a few months old.

Even though monthly sales fell short of the record of 12,789 established in May 2016, the amount is still much above the 2010-2019 average of 10,336 sales in May. Although May is traditionally the busiest month for sales, the statistics for May 2021 fell far short of the 15,646 deals recorded in March.18,586 listings were registered in May, also more than twice the epidemic low of 9,126 in May of 2020.

According to a statement issued by TRREB president Lisa Patel, Ownership housing has been in high demand in all regions of the GTA, for both ground-oriented homes and condominium flats. This was spurred by optimism about the economy’s revival as well as cheap borrowing prices. However, in the absence of a typical rate of population growth, we have seen a slowdown in sales over the last two months compared to the March peak.

Although year-over-year sales/price fluctuations aren’t always a good indicator of where the market is headed, they do suggest that demand is quite robust. We may expect significant price increases this summer as more potential house buyers regain their financial confidence, given that the recovery hasn’t begun.

In May, average GTA selling prices jumped by 28.4% year-over-year to a new high of $1,108,453. The average price increased by 1.1 percent when measured on a seasonally adjusted basis between April and May of 2021.

“While sales have trended off in March 2021 peak, so too have new listings. This implies that those who are actively searching to buy a property are still up against stiff competition from other purchasers, putting upward pressure on selling prices. This competition is becoming more widespread with tighter market circumstances in the condominium apartment category,” says TRREB Chief Market Analyst Jason Mercer in a statement.

“The shortage of homes in southern Ontario has been widely recognized. Supply has been identified as a problem by policymakers at all levels. It’s critical to recognize that addressing this issue is important not just for long-term housing affordability, but also for the Greater Golden Horseshoe’s economic competitiveness. “People and companies are more willing to locate in areas where there is a plentiful supply of affordable homeownership and rental options,” says TRREB CEO John DiMichele in a statement.

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