February Housing Numbers

The February housing data for the GTA made one thing clear, for as much as sales can drop, new listings can fall just as quickly. The housing market in Toronto remains balanced because sales and new listings are falling in sync, and in response inventory levels are barely moving. These factors have meant the continued, though slow up tick in prices, which rose by nearly 2% to $780,397 for the month.

Starting with prices, just as January did, February offered some positive and negative (literally) numbers. The average home price in the GTA did rise; however, the average detached home price fell by $20,000, to $980,914 from $1,000,736. Breaking that figure down by looking at benchmark prices, Halton, York and Durham all saw the price of their benchmark detached home lose value. In comparison, the condo market continued to be the strongest performer, though the results there were mixed across TREB. The gains were mainly realized by Toronto (up 8.7%) and Peel (up 11.8%), while Halton barely performed inflation (up 2.7%), York lost to inflation (up 1.2%) and Durham lost ground all together falling 1.5%.

Feb Annual SalesSource: TREB, Six Housing Sense

Looking at the monthly sales figures, the statistic that is always reported is the year-over-year change. For this February, sales fell just over 2% from 2018. However, as the graph above shows, comparing last month’s sales total to any other February in the past five years would be less kind. In comparison to 2017, February’s sales fell by 37%, or compared to 2016 they fell by 34%. Even against the next lowest year for February sales, 2019 was still 12% lower than 2014. Coming off of peak sales years, the GTA market is clearly in a prolonged sales slump, or worst yet for the industry, simply establishing a new normal.

Despite new listings falling by 6% year-over-year throughout TREB, inventory levels showed some growth in the city of Toronto. Active listings may be down by nearly 100 for all of TREB, but Toronto saw an active listings increase of just over 100. With the falling sales levels, active listings holding is actually causing a steady growth in the city’s months of inventory levels.

To D MOI FebSource: TREB, Six Housing Sense

Toronto’s detached market continues to see year-over-year growth in its months of inventory category, posting a 3.2 MOI. This marks a six year high for the month of February. The result was not as strong as December and January, but the continued annual improvements do put further pressure on detached prices.

To C MOI FebSource: TREB, Six Housing Sense

Toronto’s condo market inventory level remains suppressed, and yet it too is growing in comparison to recent years. Through two months of 2019, the city’s condo MOI statistic has grown by 12% from 2018. This small growth is reversing the trend that started in 2016 of continued shrinking inventory in Toronto’s condo market.

Overall February 2019 will go down as the month where the reduced new listings total worked to keep prices where they are and offset the ongoing sales struggles. As the year continues the question has to become: who’s going to return to the market first buyers or sellers? The housing industry is pushing hard to let people go back into record levels of debt, so buyers can return to the market, and that lobbying campaign may work in an election year (or so they hope). However, at a certain point of stagnate prices you have to wonder whether people will start to cash out and list their home or investment property. If this happens before buyers return to the market, the balance of power might just shift.

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