It used to be only new detached homes in the GTA cost more than $1 million, but now the average price of other new lowrise homes has also surpassed this milestone threshold.
The average price of all available new single-family ground-oriented homes in the GTA surpassed $1 million in January, according to the Building Industry and Land Development Association (BILD).
In January, the average price of new lowrise homes – including detached, semi-detached, row and townhomes – increased to a new record of $1.028 million, according to Altus Group, BILD’s official source for new-home market intelligence. Prices of new ground oriented homes grew 25 per cent in just one year.
The average price of a new detached home increased to an unprecedented $1.31 million in January. Ten years ago, the average price was $444,368. Meanwhile, the average price of a new GTA townhouse was $879,619 last month, compared to $328,989 in January 2007.
“The GTA is facing a severe shortage of housing supply, particularly for single-family homes which sell as soon as they come to market,” says BILD President and CEO Bryan Tuckey. “When there aren’t enough homes to satisfy demand, prices increase and that is exactly what has been happening in our region over the last decade.”
There were just 1,524 new ground-oriented homes available for purchase in builders’ inventories at the end of January, a near record low. At this time in 2007, there were 18,400. Meanwhile, supply of new detached homes declined to 534, the lowest ever recorded in the GTA. Ten years ago, there were 12,242.
The average price of new condominium apartments in stacked townhouses and mid- and highrise buildings in the GTA reached $507,511 in January, also setting a new record. The average price per square foot reached an unprecedented $625. New condo prices have grown 13 per cent since January of last year, increasing by almost $60,000. A decade agom the average price was $322,569.
“Our industry is implementing provincial policy by building more condominium apartments and less ground-oriented housing,” Tuckey says. “A decade ago, condominiums represented just 42 per cent of available inventory, compared to 88 per cent in 2017.”
After years of healthy supply, the number of new condominium units available for purchase began to decline. In January 2017, there were 11,529 new condominiums in builders’ inventories across the GTA, which is a 10-year low.
Overall, there were 13,053 new homes in builders’ inventories across the region in January, compared to 31,461 a decade ago.
“Today in the GTA, there are less than half the overall number of new homes available to purchase than there were a decade ago,” Tuckey says. “Lack of serviced developable land, excessive red tape and frequent delays in the development approval process have all been large contributors to our housing supply crisis.”
New condominium sales were the strongest recorded for a January following a record year in 2016. There were 1,199 homes sold across the GTA in January, most of which were sold in the city of Toronto. That is an 11-per-cent increase over last year.
“Demand for condominium apartments is coming from a variety of sources,” says Patricia Arsenault, executive vice-president of research consulting services at Altus Group. “Among them, end users who prefer the locations and amenities afforded by condominium apartments; families who might have opted for a single-family home, but have been shut out of that segment due to lack of available product; and investors who are the key providers of new rental supply for the GTA’s growing population.”
Sales of new single-family homes declined to one of the lowest Januaries in the last decade. There were 741 homes sold across the region of which 369 were detached.