January 10, 2022 | Buying
As 2021 came to a close, TRREBS MLS system reported a new record number of sales to end off the year. 121,712 sales were reported this year, a number that is up 7.7% from the previous high of 113,040 sales that we saw at the end of 2016, and up 28% compared to 2020. Demand was at a record high against a constrained supply of listings, with new listings up by 6.2%- a lesser annual rate than sales. This year was packed with extremely tight market conditions and record-breaking sale prices- the all-time-high average selling price of $1,095,475 increased by 17.8% compared to the previous record held by 2020 of $929,636.
Despite the waves of COVID-19, the demand for homeownership sustained a record pace throughout the entire year beginning January 1, 2021. The economy began to rebound slightly as well as the fact borrowing costs remained extremely low. These two factors not only supported a continuation in demand for freehold housing but developed a recovery in the condo market as well.
A sale trend that was prominent in 2021 compared to 2020, was the resurgence in demand for homes within the City of Toronto, as many Torontonians moved out of the city when the pandemic began. Overall sales in Toronto were up by a substantially greater annual rate (+36.8%) compared to the sales growth for the surrounding GTA suburbs combined (23.6%) predominantly driven by the condominium market bouncing back.
Tight market conditions conquered the GTA and broader Greater Golden Horseshoe in 2021, with a severe lack of inventory. This supply issue resulted in intense competition between buyers, forcing sale prices upwards by double digits year-over-year. As we look into 2022, the only sustainable way to moderate price growth is to bring more supply into the market. Historically, we have witnessed demand-side policies such as additional taxation on principal residences, foreign buyers, and small-scale inventory, not being a successful long-term solution to housing affordability or supply limitations.
In December, 6,031 sales were reported – a strong result historically, but still down by more than 1,000 transactions (-15.7%) compared to the record 7,154 sales in December 2020. Over the same period, new listings dropped by 11.9% to 5,174. The MLS Home Price Index Composite Benchmark was up by 31.1% compared to December of last year. The average selling price was $1,157,849- up by 24.2% annually.
There is no doubt that transacting in Real Estate has certainly transformed- Throughout this pandemic we have had the pleasure of servicing a number of our clients, resulting in successful and most of all SAFE transactions throughout. Severe precautions are in place, and while we keep those in the forefront, we are still here to 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 Toronto Real Estate Market. Contact us today for a no-obligation discussion on how we can help you throughout your real estate journey.