2018 concluded with December producing 3,781 transactions in the GTA, a 22.5% decline over December 2017. Last year during the month of December individuals accelerated their home purchases in response to the new mortgage stress test guidelines that took effect on January 1, 2018. In total, 2018 finished the year with realtors recording 77,426 residential transactions. This is the lowest sales total since 2008.
The average home price for all home types in the GTA was $750,180, a 2.1% increase over December 2017. However, many communities outside the GTA witnessed a decline. Markham saw the average sale price for all properties decrease by 14.9% ($851,817) over last year, while Stouffville saw a decrease to the average sale price for all properties by 6% ($843,188) when compared to the previous year.
A major contributor to the increase in average home price in the GTA is the City of Toronto’s condominium market. This segment reflects a major portion of the Toronto Real Estate Board and performed better from a pricing perspective. Overall, Jason Mercer, TREB’s Director of Market Analysis and Service Channels indicated that “Price growth was strongest for less expensive home types, as many home buyers sought more affordable home ownership options”.
With many different sub-layers to the marketplace, it is important to identify the market that you will be selling and/or buying in. A trusted real estate agent will ensure that you are positioned correctly for the market you are in.
What Does This All Mean?
During 2018, significant government interventions (such as interest rate adjustments and political agendas) caused downward pressure to be put on price. This resulted in the real estate market shifting from a balanced market to a buyer’s market (or in some communities a hyper-aggressive buyer’s market).
Looking forward to 2019, we anticipate a more cautious market as buyers and sellers continue to watch interest rates. If there are more adjustments by the Bank of Canada, then we can expect the market to tighten. If rates hold still, then we can foresee a consistent and steady marketplace throughout the year. There is great anticipation for a strong, healthy and stable real estate market in 2019. Wishing you a happy and prosperous new year!