Toronto Sales Down in December, Prices up YOY
There’s no denying now that we’re smack dab in the middle of a real estate softening. December stats are in for the number of sales and homes sold in the GTA and they show what the past few months of data have been depicting. Sales are slowing down as people find it tougher to get a mortgage, but prices are still high when compared with December of 2011. That is likely to continue changing as sales activity slows even further.
During December 2012, Toronto home sales dropped 19.5 per cent from where they stood during December 2011. While the last month of 2011 saw a total of 4.585 homes sold, last month only 3,690 homes changed hands across the GTA.
And while many predicted that a drop in housing activity would also see a decline in prices, that’s not true when comparing year-over-year just yet. Going by those statistics you can see that prices are still up YOY, with the average price rising to $478,789 in December 2012 from $449,566 during December 2011. That’s an increase of 6.5 per cent for those that are keeping track.
And while many will be quick to blame the mortgage rules that went into effect last summer for the slowdown, Ann Hannah, president of the Toronto Real Estate Board, says that you have to go deeper than that. There were a number of changes and factors that had Toronto sales showing smaller figures this year.
“We saw strong year-over-year growth in sales in the first half of the year, but this growth was more than offset by sales declines in the second half,” says Ms. Hannah. “Stricter mortgage lending guidelines resulted in some households postponing their purchase of a home. In the City of Toronto, the dip in sales was compounded by the additional land transfer tax.”
But it’s not just Toronto’s land transfer tax that’s doing damage. Just prior to this Toronto report being published, new stats came out showing that in Vancouver sales had dropped a whopping 31.1 per cent from December of 2011. While we can certainly expect to see the most dramatic numbers coming out of this market that was definitely one of the hottest at the height of the boom, there’s little doubt that those numbers are discouraging to anyone trying to sell their home out West right now.
Looking at the overall year and not just focusing on December, it’s also interesting to see that total home sales for the entire country dropped by 4 per cent in 2012 when compared with 2011, from 89,096 to 85,731.
That’s a trend that’s expected to continue as well. The Canadian Real Estate Association has forecasted that sales will drop 2 per cent this year.