Toronto, Vancouver home sales heat up in October

Home sales in Toronto increased almost 12% in October from September. That’s an above-average rise that points to a stronger fall market, the Toronto Real Estate Board (TREB) said Thursday.

Vancouver also saw a jump in October, with sales up 7% from September and a 35% year-over-year rise for the month, the Real Estate Board of Greater Vancouver (REBGV) reported. The sales were 15% higher than the 10-year October average.

There is usually a jump in sales in September and October, TREB president Tim Syrianos said in a release, but this year’s uptick is the most pronounced in a decade.

“While the number of transactions was still down relative to last year’s record pace, it certainly does appear that sales momentum is picking up,” he said in the release.

The 7,118 residential sales reported last month in Toronto were down 27% from October 2016, and sales through 10 months of 2017 are down more than 19% from last year.

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The average selling price in October was $780,104, up 2.3% compared to October 2016. This was driven by increases in the prices of townhouses (up 7.4% year over year to$629,507) and condos (up 22% to$523,041).

Detached home prices dropped 2.5% year over year to an average of $1 million, while semi-detached homes increased 6.3% to $764.293.

In Metro Vancouver, the average price for all residential properties in October was $1,042,300, an increase of 12.4% year over year and 0.5% compared to September 2017.

For detached properties, the price was $1,609,600, up only 4% from last year. The prices for apartments (up 22.7% to $642,000), and attached units ($802,400, up 17.7%) increased more dramatically, which REBGV president Jill Oudil attributed to limited supply.

Regulatory impact

The government in B.C. introduced a 15% tax on foreign buyers last year. Ontario adopted the same measure in April, along with other rules to cool the housing market. New lending rules from the Office of the Superintendent of Financial Institutions (OSFI) come into effect early next year, with a stress test that could require buyers to show they can make their payments if interest rates rise.

“The federal government’s announcement of plans to tighten mortgage requirements for the seventh time in the last eight years also helped spur activity in the short term,”Oudil said in a release. “Many buyers are trying to enter the market before the changes are in place,” he adds.

As for the provincial rules, TREB director of market analysis Jason Mercer said in a release that their effect may be wearing off.

“Similar to the track followed in the Greater Vancouver Area, it appears that the psychological impact of the Fair Housing Plan, including the tax on foreign buyers, is starting to unwind,” he says.

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