We saw a recovery in real estate sales activity in 2019, particularly in the second half of the year. Many home buyers who were waiting to see what was going to happen to the housing market after the introduction of the new mortgage stress test 2 years ago decided to not hold off further. Buyer confidence in the real estate market has bounced back in the last six months of 2019 which has put upward pressure on housing market prices.
Sales were up in 2019 but the number of new listings did not increase in proportion to demand. For the past decade, annual new listings have been largely in a holding pattern between 150,000 and 160,000, despite the upward trend in demand for housing and ever-increasing home prices over the same period.
Housing supply in the Great Toronto Area has been an ongoing concern for over a decade and the increased migration and immigration into GTA is putting further pressure on the demand for housing. The lack of housing stock supply and rental housing has had a negative impact on housing affordability in the GTA.
In 2019 we experienced a strong increase in the number of properties sold and a decline in new listings which has resulted in increasing house and condo prices. There isn’t a short term solution to the housing supply and hence it is expected that in 2020 we will continue to see increased pressure on housing prices. The last two months of 2019 saw increased bidding wars in the lower-priced housing stocks: condos, townhomes, and semi-detached homes.
The average selling price of all property types in December 2019 was $837,788 – up almost 12 percent year-over-year. For the calendar year 2019, the average selling price was $819,319 – up by four percent compared to $787,856 in 2018.
It is expected that in 2020 we will continue to see a shortage of new MLS listings and a continued increase in housing demand which will result in continued pressure on prices in the Greater Toronto Area.