A recent report found that new home sales have majorly dropped in the GTA, sinking to a record monthly low last month, and below the 10-year-average for July.
According to data from Altus Group, the Building Industry and Land Development Association’s (BILD) source for new home market intelligence, there were only 654 new home sales last month in the GTA, a decrease of 48 per cent from last year July and 70 per cent below the 10-year average.
About 287 condo units, stacked townhouses and loft units were sold in July — down 67 per cent from last year July and 81 per cent below the 10-year average. Single-family home sales fared slightly better in July, with 367 sales. Still, this is down one per cent compared to July 2023, and 42 per cent below the 10-year average.
Benchmark prices of new homes dropped in July compared to last year. The benchmark price of a new condo apartment was $1,020,179 (down six per cent over the last 12 months), and the benchmark price of a new single-family home was $1,585,881 (down five per cent over the last 12 months).
There are also more new homes available for sale compared to the previous month (21,660 units — 17,445 condominium apartment units and 4,215 single-family homes). The report suggests that this high number isn’t because the number of new units coming to market is dramatically increasing, but rather because sales are continually decreasing.
“This is an unhealthy situation, because as interest rates decrease, sales will return but it will take longer for new building to recover, setting up a future supply/demand imbalance,” the report stated.
Justin Sherwood, senior Vice President of communications and stakeholder relations at BILD, said that the government urgently needs to respond to solve the deeper issues in the GTA — mainly the cost to build, driven by excessive government fees and taxes, is simply too high.
“Without immediate action by government, new construction activity will continue to slow and the GTA’s housing shortage will reach unprecedented levels over the next few years,” Sherwood said in a statement.
Still, Edward Jegg, Research Manager with Altus Group, sees hope for the future.
“Further expected decreases in interest rates in the coming months, along with elevated inventories, means there will be plenty of opportunities once consumer confidence improves,” Jegg said.
