Greater Toronto REALTORS^® Report March Resale Market Figures

TORONTO, April 6, 2010 – Greater Toronto REALTORS® reported 10,430 sales through the Multiple Listing Service® (MLS®) in March, pushing total first quarter 2010 sales to 22,418 – the best result on record under the current Toronto Real Estate Board (TREB) boundaries. The average price for March transactions was $434,696. The average price for the first quarter was $427,948.

“The strong rebound in the existing home market was one of the initial drivers of economic recovery,” said TREB President Tom Lebour. “While we don’t expect to see the same rates growth moving forward, GTA households will remain confident in ownership housing as a quality long-term investment, especially as economic recovery expands across all industries.”

The annual rate of growth for new listings continued to accelerate in March. The number of new listings grew by 42 per cent compared to March of 2008.

“The average home price in the GTA will continue to grow this year, but the pace will slow as we move through the spring,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “As growth in new listings starts to outstrip growth in sales, buyers will experience more choice, resulting in more sustainable single digit rates of average price growth.”

In February, the Canadian Composite Index of Leading Indicators rose 0.8 per cent, after a revised 0.7 per cent increase in January. It was the ninth straight month that the index has remained in positive territory. Nine of the 10 index components increased, with only the average weekly hours worked, which was down 0.8 per cent, bucking the trend.

On the consumer-driven side of the economy, much of February’s overall advance can be traced to strength in the housing component of the index. A strong rebound in consumer-related sectors has been the driver of economic recovery to date. However, for recovery to be sustained, goods producing sectors associated with trade must start to contribute more to growth.

Improvement in trade will be dependent on economic recovery in the United States – Canada’s single largest trading partner. The latest leading indicator release contained good news in this regard. The US leading indicator also increased for the ninth straight month. The improving economic situation south of the border has arguably spurred increased orders for goods manufactured in Canada, with new orders for durable products increasing by over six per cent in February.

Moving forward, however, it will be important to watch the impact of the high value of the Canadian dollar vis-à-vis the US. A strong currency relative to our trading partners’ has been generally seen as detrimental to trade and by extension Canada’s manufacturing sector.

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Source: Statistics Canada with economic commentary by Jason Mercer – TREB Senior Manager of Market Analysis

GTA REALTORS® REPORTING MARCH MID-MONTH HOUSING STATISTICS

TORONTO, MARCH 17, 2010 – Greater Toronto REALTORS® reported 4,353 sales through the Multiple Listing Service® (MLS®) during the first two weeks of March.

This represented a 70 per cent increase compared to the 2,562 sales recorded during the same period in 2009 when resale transactions had dipped markedly due to the recession. The mid-month sales total was also 16 per cent higher than the previous March midmonth high reached in 2006.

“The spring-like weather in the first half of March brought the first green sprouts of the recurring spring market. Every year, monthly sales climb steadily through May,” said Toronto Real Estate Board President Tom Lebour. “People are buying homes because they are confident in the current economic recovery and mortgage payments on the average priced home remain affordable.”

The average price for March mid-month transactions was $440,153 – a 20 per cent increase over 2009. New listings within the Toronto Real Estate Board boundaries were up 34 per cent to 8,540.

“Look for double-digit annual price increases to cease later in 2010, as new listings rebound from the low levels experienced in 2009,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “Increased listings will give buyers more choice, resulting in less upward pressure on home prices.”

Comparisons are often made between the current real estate boom and the one experienced in the Greater Toronto Area from 1986 – 1989. While there are some similarities, there are a number of key differences that have contributed to the extended real estate ‘boom’ here in the GTA.

The most important difference has to do with affordability. Affordability refers to the share of average household income used to pay the mortgage, property taxes and utilities on a home. As you can see from the chart below, there is a dramatic difference between the current affordability level and the levels experienced throughout the course of the real estate boom in the late 1980′s. At it’s peak in 1989, nearly 55% of every household dollar earned went towards paying the mortgage, property taxes and utilities!

Toronto condos help increase housing starts in February

The seasonally adjusted annual rate of Canadian housing starts reached 196,700 units in February 2010, up 6.1 per cent from a downwardly revised January figure of 185,400 units. Much of this gain took place in the urban multiple-family segment of the market, which includes condominium apartments. Increases in multiple-family home starts were especially noted in the Toronto Census Metropolitan Area (CMA), where the annual rate of total starts was up by 66 per cent compared to January.

Tight resale market conditions in the GTA and Canada-wide have started to impact new home construction. As resale market conditions tightened in 2009, more home buyers started to visit preconstruction sales centres. Stronger new home sales in the second half of last year have started to translate into increased home starts, especially in the high-rise segment of the market. Residential construction activity will continue to improve this year. The Canada Mortgage and Housing Corporation has forecast between 30,000 and 34,000 starts per year over the next two years, a substantial improvement over the 26,000 starts in 2009.

View January 2010 Housing Starts

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Source: Canada Mortgage and Housing Corporation (CMHC) with economic commentary by Jason Mercer – TREB Senior Manager of Market Analysis