June 7, 2023 | Buying
The GTA housing market continued to improve from a sales standpoint in May 2023. Unfortunately, the supply of homes for sale did not keep up with the demand for ownership housing. Sales as a share of new listings were up considerably compared to a year ago. This is a clear signal that competition between buyers increased significantly compared to last year, resulting in the average selling price reaching almost $1.2 million last month.
Notwithstanding the fact that we have seen positive policy direction over the last couple of years, governments have been failing on the housing supply front for some time. Recent polling from Ipsos found that the City of Toronto residents gave Council a failing grade on housing affordability and pointed to lack of supply as the key issue. This issue is not unique to Toronto. It persists throughout the Greater Golden Horseshoe. If we don’t quickly see the housing supply catch up to population growth, the economic development of our region will be hindered as people and businesses look elsewhere to live and invest.
GTA REALTORS® reported 9,012 sales through TRREB’s MLS® System in May 2023 – a 24.7% increase compared to May 2022. Equally, new listings were down by 18.7% over the same period. On a month-over-month seasonally adjusted basis, sales were up by 5.2% compared to April 2023.
The MLS® Home Price Index (HPI) composite benchmark was down by 6.9% year-over-year in May 2023, but up by 3.2% on a seasonally adjusted monthly basis compared to April 2023. The average selling price, at $1,196,101, represented a small 1.2% decline relative to May 2022. On a seasonally adjusted monthly basis, the average selling price was up by 3.5% compared to April 2023.
The demand for ownership housing has picked up blatantly in recent months. Many homebuyers have recalibrated their housing needs in the face of higher borrowing costs and are moving back into the market. In addition, strong rent growth and record population growth on the back of immigration has also reinforced the increase in home sales. The supply of listings hasn’t kept up with sales, so we have seen upward pressure on selling prices during the spring.
There is no doubt that transacting in Real Estate has certainly transformed these last few years. We have had the pleasure of servicing our clients through these unprecedented times and will continue to do so as the real estate market climate change. Despite the recent cooling of sales, the Toronto Real Estate Market still remains one of the strongest markets in the world, and we can offer our guidance and expertise to help you make the next real estate move that is right for you and find ways to take advantage of the current market. Contact us today for a no-obligation discussion on how we can help you throughout your real estate journey.