Toronto Star
GTA house sales down 15 per cent in February as high-end homes take huge hit
Toronto luxury homes lost their lustre in February, which contributed to a 15 per cent decline in house sales across the GTA year over year, according to new figures from the Toronto Real Estate Board.
Toronto luxury homes lost their lustre in February, which contributed to a 15 per cent decline in house sales across the GTA year over year, according to new figures from the Toronto Real Estate Board. (See charts, below.)
Sales of homes over $2 million plummeted by 32.5 per cent and dollar volumes slipped by 35.5 per cent last month compared with February 2012.
That, combined with a flatlining sales of detached homes in the 416 region in particular, hit the sales numbers hard.
“I’d be cautious about suggesting there is any kind of trend here,” said Jason Mercer, senior market analyst for TREB. He says high-end sales have been in decline since late last year, but that the spring should provide a better indicator of where that small but significant segment of the market is headed.
The average selling price of a GTA home was $510,580 last month, up just two per cent from a year earlier.
Resale condo transactions also took a serious hit, with sales down more than 20 per cent across the GTA. Prices slide by five per cent in the City of Toronto, but were up more than four per cent in the 905 regions.
The MLS composite house index, which eliminates volatility and fluctuations in the market, was up more than three per cent year over year, says TREB.
It didn’t help that February 2012 was a leap year, which skewed the numbers slightly, notes the report released Tuesday. When that extra business day last year is factored out, house and condo sales were down an average 10.5 per cent year-over-year, it says.
Either way, that’s a significant turn around from January , when sales were down just 1.3 per cent year over year, bidding wars were heating up and realtors were “cautiously optimistic” the Toronto housing market was picking up steam after months of largely double-digit sales declines.
Now, buyers are holding out for bargains, says downtown realtor Brian Persaud, who saw an unexpected flurry of inquiries this week when BMO announced a restrictive 2.99 mortgage rate.
“We’re even seeing multiple lowball offers on properties,” says Persaud. “But owners are holding out. They’re not coming down that much.”
TREB president Ann Hannah blamed the high-end downturn in particular on the City of Toronto’s land transfer tax and a segment of stricter mortgage guidelines which were aimed at reining in borrowing for high-end homes in particular.
“We will undoubtedly experience some volatility in price growth for some market segments in 2013. However, months of inventory in the low-rise market segment will remain low, resulting in average price growth above three per cent for the TREB market area this year,” said Mercer.
“Our current average price forecast is $515,000 for all home types combined in 2013.”
Detached homes saw the biggest sales declines, next to resale condos, with transactions down 16 per cent across the GTA, and almost 17 per cent in the City of Toronto.
Prices flatlined in the 416 region for those coveted homes, with sale prices averaging $823,329. Detached home in the 905 areas sold for an average 3.4 per cent more in February, compared to the same month last year, with prices averaging $582,777.
Sales of semi-detached homes were down about 15 per cent across the GTA, although prices were up 6.2 per cent in the 416 region (to an average $450,44) and 4.4 per cent in the 905 regions (to $371,640).
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