The Toronto Real Estate Board President’s Col­umn as it appears in the President’s Resale Homes & Con­dos

North Dis­tricts

Sales growth in the Toronto Real Estate Board’s north dis­tricts fol­lowed the trend for the GTA as a whole, with sales slightly more than dou­ble the level expe­ri­enced in Novem­ber 2008. “The north dis­tricts encom­pass a broad array of hous­ing alter­na­tives, from large single-detached homes on estate style lots through con­do­minium apart­ments pointed at first-time buy­ers.

Because the exist­ing home stock caters to the major­ity of home own­er­ship pref­er­ences that exist in the GTA, it makes sense that sales growth in the north dis­tricts would fol­low that of the GTA as a whole,” com­mented Jason Mer­cer, TREB’s Senior Man­ager of Mar­ket Analysis.

The north dis­tricts also expe­ri­enced the largest decline in aver­age days on the mar­ket com­pared to last Novem­ber, drop­ping 45% to 29 days. Over the same period the aver­age sale price to ask­ing price ratio increased to 99%.

Mer­cer expects that growth in own­er­ship hous­ing demand will remain strong over the long-term: “The GTA is the sin­gle great­est ben­e­fi­ciary of immi­gra­tion into Canada. Many new com­ers chose to move into York region between 2001 and 2006 accord­ing to the 2006 Cen­sus of Canada. This speaks to the diver­sity of employ­ment oppor­tu­ni­ties and ameni­ties the north­ern GTA has to offer.”

East Dis­tricts

The aver­age home price for the Toronto Real Estate Board’s east­ern dis­tricts remained lower than the aver­ages for the west, cen­tral and north dis­tricts. “The com­bi­na­tion of com­par­a­tively lower home prices and very low mort­gage rates has been attrac­tive to house­holds look­ing to take advan­tage of afford­able low-rise home own­er­ship opportunities.

In some cases, for exam­ple, a house­hold could pur­chase a single-detached house in Durham Region for the aver­age price of a con­do­minium apart­ment in down­town Toronto,” explained Jason Mer­cer, the Toronto Real Estate Board’s Senior Man­ager of Mar­ket Analy­sis. While the east­ern dis­tricts have the low­est aver­age price, it is inter­est­ing to note that they also exhib­ited the strongest year-over-year price increase in Novem­ber, at 17%.

“As in other Toronto Real Estate Board dis­tricts, demand for own­er­ship hous­ing has increased rel­a­tive to the sup­ply of list­ings in the mar­ket. The result has been strong growth in home prices,” con­tin­ued Mer­cer. “It is also impor­tant to real­ize that if the com­po­si­tion of home sales changes, this also impacts aver­age price. For exam­ple, if the share of single-detached home sales was greater this year than last, that would influ­ence the growth rate of aver­age price.”

West Districts

The Toronto Real Estate Board’s west­ern dis­tricts expe­ri­enced strong annual price growth on aver­age, climb­ing 12% to $397,184. Accord­ing to Jason Mer­cer, the Toronto Real Estate Board’s Senior Man­ager of Mar­ket Analy­sis, “tighter mar­ket con­di­tions have been one of the key fac­tors behind the strong annual price growth expe­ri­enced in the sec­ond half of 2009. Sales have risen strongly rel­a­tive to listings.

As we move into 2010, how­ever, more sus­tain­able annual price increases are expected to re-emerge. More house­holds will list their homes for sale, as they react to the strong rates of sales and price growth expe­ri­enced through the end of 2009. Increased choice in the mar­ket­place will likely see the rate of price growth move into the sin­gle digits.”

Mer­cer also com­mented on the diver­sity of hous­ing types avail­able in the west: “Trans­ac­tions in the west­ern dis­tricts are spread across many dif­fer­ent home types and price ranges. In some parts of the west we have seen the con­struc­tion con­do­minium apart­ment projects cater­ing to many dif­fer­ent walks of life.

At the same time, there also exists a wide array of low-rise hous­ing that attracts first-time buy­ers right through to house­holds look­ing for lux­ury accom­mo­da­tion priced over one mil­lion dollars.”

Cen­tral Districts

In Novem­ber, the Toronto Real Estate Board’s cen­tral dis­tricts expe­ri­enced the largest year-over-year increase in sales at 111%. Accord­ing to Jason Mer­cer, the Toronto Real Estate Board’s Senior Manger of Mar­ket Analy­sis, “the rea­son for the large reported increase in sales is two-fold.

First, we have def­i­nitely seen a resur­gence in con­sumer con­fi­dence regard­ing the home own­er­ship mar­ket. Inter­est rates are very low and we have seen increas­ing signs that the econ­omy is on the recov­ery path.

Sec­ond, we also have to remem­ber that we are com­par­ing sales dur­ing the hous­ing mar­ket recov­ery this year with sales dur­ing a steep mar­ket decline last year. This is known as the base year effect.” The cen­tral dis­tricts also expe­ri­enced the short­est aver­age days on the mar­ket and largest sale price to list­ing price ratio.

Mer­cer added that “sales have risen strongly rel­a­tive to list­ings over the past year. With less sup­ply in the mar­ket com­pared to demand, trans­ac­tions have occurred at a quicker pace and sub­stan­tial upward pres­sure has been exerted on the aver­age resale home price.”

Tom Lebour is Pres­i­dent of the Toronto Real Estate Board, a pro­fes­sional asso­ci­a­tion that rep­re­sents 28,000 Real­tors in the Greater Toronto Area.

I just wanted to add a sum­mary. Here are the 2009 monthly totals, for both sales and aver­age price:

Jan:  2,670 | $343,632
Feb:  4,120 | $361.305
Mar:  6,171 | $362,050
Apr:   8,107 | $385,641
May:  9,589 | $395,609
Jun: 10,955 | $403,972
Jul:    9,967 | $395,414
Aug:  8,035 | $387,921
Sep:  8,196 | $406,877
Oct:   8,476 | $423,559
Nov:  7,446 | $418,460
Dec:  5,541 | $411,931

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real estate growth rate in toronto

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