March 5, 2012 -- Greater Toronto REALTORS® reported 7,032 sales in February 2012 – up 16 per cent compared to February 2011. New listings were also up over the same period, but by a lesser 11 per cent to 12,684. It is important to note that 2012 is a leap year, with one more day in February. Over the first 28 days of February, sales and new listings were up by ten per cent and six per cent respectively.
“With slightly more than two months of inventory in the Toronto Real Estate Board (TREB) market area, on average, it is not surprising that competition between buyers has exerted very strong upward pressure on the average selling price. Price growth will continue to be very strong until the market becomes better supplied,” said Toronto Real Estate Board President Richard Silver.
“It is important to note that both buyers and sellers are aware of current market conditions. This is evidenced by the fact that homes sold, on average, for 99 per cent of the asking price in February,” continued Silver.
The average selling price in the TREB market area was $502,508 in February – up 11 per cent compared to February 2011. The Composite MLS® Home Price Index for TREB, which provides a less volatile measure of price growth compared to the average price, was up by 7.3 per cent compared February 2011.
“If tight market conditions continue to result in higher than expected price growth as we move into the spring, expectations for 2012 as a whole will have to be revised upwards,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “While price growth remains strong, the average selling price remains affordable from a mortgage lending perspective for a household earning the average income in the GTA.”
Market to Moderate Through 2011: Royal LePage
The housing market in this country is beginning to moderate, according to new data reflected in the Royal LePage House Price Survey and Market Survey Forecast. In Q2, average prices rose across all property types year-over-year, with detached bungalows rising 7.5 % ,standard two-storey homes rising 6.1 % and standard condominium rising 3.5 % to $238,064.
"In many of Canada's regional markets, we saw house prices appreciate at a significantly faster rate than wages and salaries, and this trend cannot continue indefinitely," observed Phil Soper, president and chief executive, Royal LePage Real Estate Services. "We expect price gains to moderate considerably in the latter half of 2011, which should reduce the stress associated with purchasing a new home," Soper said. "Vancouver, and specifically certain neighbourhoods in the lower mainland of British Columbia, remains an anomaly, as investment from outside of the country continues to support higher price levels."
"While the global economy struggles to find its footing, here in Canada we are seeing indicators of a return to long-term norms," noted Soper. "There is an expectation of continuing improvement in employment levels across the country and accompanying strength in wages and salaries, which should provide support for the housing market. Looking ahead to 2012, signs are pointing to stability for Canadian home owners and new buyers. We believe we are past the period of peak house price appreciation."
Looking at some regional highlights, the Halifax market showed health and strength, and the forecast through the end of 2011 is a price gain of 3.3% over 2010. Driven by a surge in price for bungalows and two-storey houses, prices are expected to rise by 7.0% by the end of 2010 in Montreal. The market in Ottawa spread its’ gains fairly evenly across all housing types, and the end result is an expected rise of 5.0 % in 2011.
Toronto was one of the centres to see rapid price appreciation through the first few months of this year, and is now faced with a shortage of listings. In Winnipeg, a robust local economy is driving their real estate market up an expected 6.0 % for the year. The largest year-over-year gain was registered in Regina, and the forecast is that this will continue through 2010 to the tune of 12.4%.
Calgary is still picking up the pieces after a pre-recessionary price hike, but housing prices are still likely to increase by a respectable 3.8%. After a meteoric rise through the beginning of the year in Vancouver, prices are expected to settle at around a rise of 6.0%.
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