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Toronto home sales fall 12.5% in August
Greater Toronto Area Realtors reported 6,418 sales through the TorontoMLS system in August 2012, representing a year-over-decline of almost 12.5 per cent compared to 7,330 sales reported in August 2011. The number of new listings reported in August was down by 5.5 per cent compared to the same period in 2011.
“Residential transactions were down in August compared to last year. Stricter mortgage lending guidelines, which came into effect in July, arguably played a role. In the City of Toronto, the additional impact of relatively higher home prices coupled with the upfront cost associated with the City’s Land Transfer Tax led to a stronger annual decline in sales compared to the rest of the GTA,” said Toronto Real Estate Board (TREB) President Ann Hannah.
The average selling price for August 2012 transactions was $479,095 – up by almost 6.5 per cent compared to August 2011. The annual rate of price growth was driven by the low-rise home segment in the City of Toronto, including single-detached homes with an average annual price increase of 15 per cent. The MLS® Home Price Index composite index, which allows for an apples-to-apples comparison of benchmark home prices from one year to the next, was up by 6.3 per cent year-over-year.
“While sales were down year-over-year in the GTA, so too were new listings. As a result, market conditions remained quite tight with substantial competition between buyers in the low-rise market segment,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “The trends for sales and new listings are moving somewhat in synch, suggesting that the relationship between sales and listings will continue to promote price growth moving forward.”
See the complete Toronto Real Estate Market Watch report »
September 6, 2012 in Toronto Real Estate Board, Toronto Real Estate Market, Toronto Real Estate Update | Permalink
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There is a fall on Toronto home sales. Useful information
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Posted by: Anastasia L. Thelusma | Oct 15, 2012 7:47:35 AM
New Condominium units in Toronto have shrunk in size overall; they’ve gone down by 100 sq ft over the last 5 years on average. We will have to see the impact in the rental market when all the towers now under construction in Toronto hit the market.
The average size of a new condominium unit in Toronto is 650 sq ft and based on average price, it will cost about $330,000. With rental rates on average $2.20 /sq ft, investors may expect monthly rent about $1,450.
But will that rent cover the costs for the investor? With 20% down, a $264,000 mortgage at 3% amortized over 25 years, the principal and interest costs would be close to $1,250/month. Monthly condominium fees are about $0.50/sq ft per month on average and property taxes are about 1% of home value. When utilities are added the cash flow becomes negative.
The condominium market in Toronto, the biggest of its kind in North America for that class of housing, is largely based on a capital appreciation. Most investors finance their condominium units knowing that they will be unable to carry them on a cash-flow positive basis based on present rental rates. The condominium game continues to be about capital appreciation and very small return would shrink the pool of investors.
Posted by: Nalliah Thayabharan | Sep 12, 2012 8:26:59 PM
Toronto real Estate Sales are down, but last year was a record year. Its better to gauge how the market is by looking at the past 3 years as a whole.
Posted by: James | Sep 7, 2012 9:44:39 PM
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