GTA home sales up 362% since last April, but market is starting to slow

April delivered a record number of home sales for the Greater Toronto Area, but the market is starting to slow from the intense pace seen earlier this year, the Toronto Regional Real Estate Board said Wednesday.

The Ontario-based board revealed 13,663 homes were sold in the region last month, a 362% increase from the 2,957 properties sold during the prior April, which was the first full month of the Covid-19 pandemic.

However, home sales in April were down 12.7% from 15,652 in the month prior.

While the first three months of the year were full of bidding wars, soaring prices and a mad scramble to snatch up any available homes, Toronto real estate broker Wins Lai is seeing conditions cool.

“The stay-at-home order is definitely slowing things down a bit for people,” she said.

“I have a lot of [clients looking to buy] that have sold, but they’re just waiting on the sidelines because they want to see what is the right move for them.”

She’s predicting there will be another housing boom later in the spring, when more people are vaccinated and taking part in past times that were curtailed for the pandemic.

She’s noticed people being more judicious about what they bid on lately and careful about following Covid-19 restrictions, but found many still want to buy now to take advantage of low interest rates.

The number of homes they have to choose from is dramatically different than this time last year.

New listings in April soared by 237%, when compared with last year but dropped by 8.4% when compared with March 2021, TRREB said.

Many listing their homes aren’t willing to ease up on pricing, even as the market slows, because the start of the year was so hot, Lai said.

“I’m working with some sellers who are not willing to bring the price down right because they think worst-case scenario, I’ll just not sell it and stay where we are,” she said.

The average selling price amounted to $1,090,992, up 33% from $820,226 last April but down from $1,097,565 in March 2021.

The decrease between March and April was a stark contrast to previous years when average prices typically increased between the two months and signalled the start of a flurry of spring sales.

However, TRREB’s chief market analyst Jason Mercer described the decrease seen this year as “modest slowing” and pointed out that prices across all major home types remain very high.

They were boosted in recent months by low borrowing costs during Covid-19, which sparked demand for housing, he said.

“While the pace of price growth could moderate in the coming months, home prices will likely continue on the upward trend,” he said in a release.

“Renewed population growth over the next year coupled with a persistent lack of new inventory will underpin home price appreciation.”

In Toronto alone, April delivered 4,694 sales, 7,481 new listings and an average price of $1,088,02.

The remaining area covered by the board and often referred to as the 905 saw 8,969 sales, 13,344 new listings and an average price of $1,090,992.

While sales remained strong, TRREB president Lisa Patel called them a “marked slowing” and said they signal a pullback in activity in a market that may be fuelled by the region’s population.

“We’ve experienced a torrid pace of home sales since the summer of 2020, while seeing little in the way of population growth,” she said in a release.

“We may be starting to exhaust the pool of potential buyers within the existing GTA population.”