BUSINESS
11/05/2019 08:50 EST

Toronto House Prices Accelerate As Supply Dwindles

Selling prices and rents could rise even faster if supply doesn't catch up, the local real estate board says.

jimfeng via Getty Images
Condo towers flank the construction site of CIBC Square in downtown Toronto, Sept. 24, 2018.

TORONTO ― The Toronto Real Estate Board (TREB) says home sales rose 14 per cent in October compared with a year earlier even as prices rose.

The board says there were 8,491 sales in the Greater Toronto Area in the month, up from 7,448 sales in October, 2018.

“A strong regional economy obviously fuels population growth. All of these new households need a place to live and many have the goal of purchasing a home,” TREB president Michael Collins said in a statement.

“The problem is that the supply of available listings is actually dropping, resulting in tighter market conditions and accelerating price growth.”

Watch: This Canadian castle is up for grabs. Story continues below.

 

The composite benchmark price rose by 5.8 per cent in the month for the strongest annual growth rate since December 2017, while the average selling price was up 5.5 per cent to $852,142.

Detached home sales rose 19.6 per cent with the average selling price up three per cent to $1.05 million. Condo sales were up 5.1 per cent with the average selling price up 9.6 per cent to $617,410.

Prices climbed as Toronto’s population continued to grow and the number of new listings in the month dropped by 9.6 per cent to 13,050.

Jason Mercer, TREB’s chief market analyst, said he expects prices to accelerate even ore “if sales growth continues to outpace listings growth, leading to more competition between home buyers.”

A lack of housing supply is also pushing up rental rates. TREB says the average rent for a one-bedroom apartment was up 5.8 per cent so far this year compared with last at $2,209, while rent for a two-bedroom apartment was up 4.7 per cent to $2,888.

― With files from HuffPost Canada