Toronto home prices continue to climb

Average home prices in the Toronto region climbed more than 4 per cent last month as buyers began to absorb the impact of tougher new mortgage qualification rules introduced in January.

Data from the Toronto Real Estate Board showed home prices rose 4.2 per cent in February compared to January to an average of $767,818, marking the strongest month-over-month price gain since September.

Detached home prices rose 3.1 per cent across the Greater Toronto Area in February compared to the prior month, averaging $1,000,736, while condo prices climbed 4.4 per cent over January to an average of $529,782.

Despite the increases, average prices were down 12.4 per cent in February compared to the same month last year, when sales were booming prior to a price correction that began in May last year, TREB said.

TREB said 5,175 homes sold in February across the GTA , a 35-per-cent drop compared to the record 7,955 sales in February last year, but an increase of almost 29 per cent compared to 4,019 homes sold in January this year.

There were 10,520 new listings of homes for sale in February, an increase of 7.3 per cent from the same month last year, and a jump of 23 per cent from January. Despite the increase, however, TREB said the level of new listings still remained below the February average for the previous 10 years.

Jason Mercer, TREB’s director of market analysis, said he expects sales to pick up further as the year progresses.

“As we move further into the spring and summer months, growth in sales and selling prices is expected to pick up relative to last year,” he said in a statement, predicting price growth will come in the comparatively more affordable townhouse and condominium markets.

“That being said, listings supply will likely remain below average in many neighbourhoods in the GTA, which, over the long-term, could further hamper affordability,” Mr. Mercer said.

TREB president Tim Syrianos said his association anticipated sales would be slow in the opening months of 2018 compared to historic highs in early 2017.

He said prospective buyers “are still coming to terms with the psychological impact” of housing reforms introduced last April by the Ontario government, which included a new foreign buyer’s tax, as well as new mortgage qualification rules introduced Jan. 1 that require buyers to prove they can still afford their mortgages even if interest rates rise.

While sale prices are lower than they were at their peak a year ago, TREB said they are still up 12 per cent compared to the average sale price in February, 2016, “which represents an annualized increase well above the rate of inflation for the past two years.”

Scott Ingram, a Century 21 real estate agent in Toronto, said most home owners in Toronto have made money on their property despite last year’s downturn, calculating fewer than 9,500 buyers who purchased homes in the City of Toronto last year may still be unhappy because the benchmark price in January was at least $10,000 below the price they paid last year. He said they represent about 1.3 per cent of all homeowners in Toronto.

In a new analysis for his blog, Mr. Ingram said the benchmark prices for detached houses, semi-detached houses and townhouses in the City of Toronto in January were still below the peak levels they hit last year, but said prices for all housing types are higher than they were two years ago. The benchmark condominium price has increased compared to all months last year, so buyers in that category are not under water.

Even buyers who may feel “burned” by purchasing at the peak last year will be fine in the long run, Mr. Ingram said, as long as they do not plan to flip their home quickly.

For those who bought at the peak and planned to flip quickly, Mr. Ingram said the experience is a lesson that “real estate isn’t a guaranteed investment vehicle.”

Toronto Real Estate Board ordered to open up online sales data

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The Toronto Real Estate Board must let its member brokers release more home sales data to the public via the internet, the federal Competition Tribunal ordered Friday, in a move that could resonate across Canadian real estate markets.

The tribunal’s order, which follows an April ruling that TREB was stifling competition by restricting access to data on its proprietary Multiple Listing Service, says TREB must let its members offer searchable online databases called “virtual office websites.”

Those databases allow access to important information held in MLS, including data like sales prices, broker commissions, and withdrawn listings, as well as archived data.

“We’ve always taken the position where the more information that consumers have, the better decisions they can make,” said John Pasalis, president of the Toronto real estate brokerage Realosophy and a witness in favour of opening up the data.

“We’re going to look at making it more widely available on our website now,” said Pasalis.

Some Toronto-area real estate agents are champing at the bit to take advantage of the Competition Tribunal’s order as quickly as possible. Ara Mamourian, owner of Spring Realty, wrote in his blog that releasing the previously restricted information via his company’s search tool will save time and hassle for brokers and buyers alike.

Even brokers outside of Toronto have their eye on the Competition Tribunal’s order, and expect it to impact their local markets.

“Most likely because TREB is the biggest board, I think it’s going to trickle down right to the smallest board out there,” said Mayur Arora, a realtor with Oneflatfee.ca and a member of the Greater Vancouver Real Estate Board.

Limits on home sales data

Still, the Competition Tribunal’s ruling does set some limits on exactly which MLS data can be released online.

Consumers who want to access the data will have to have a password-protected account with the broker providing it, and individual home sellers can request that TREB exclude their home sale information from the online databases. TREB can also keep certain private information about a home seller confidential, including mortgage and security information.

The Tribunal also said “TREB may limit members’ use to being directly related to the business of providing residential real estate brokerage services.”

The order represents a victory for the federal Competition Bureau. In its original application to get the data released, the bureau said the data will allow real estate agents “to offer consumers the convenience of data-driven insights into home sales prices and trends via the web and to improve the efficiency and quality of their services.”

TREB has 60 days from June 3 to implement the changes, and was also ordered to pay the Competition Commissioner’s legal costs of more than $1.8 million. In a statement, TREB CEO John DiMichele said TREB has filed a notice of appeal, but is reviewing the order with its lawyers before commenting publicly.

An ongoing legal saga

The tribunal’s ruling is the latest development in a case that goes back years. In 2011, the Competition Bureau sued TREB, Canada’s largest real estate board, for restricting the ways in which its member agents could release data from the Multiple Listing System.

The Competition Bureau said TREB’s practices were anti-competitive, and kept customers from accessing information that would help them buy a house. At the time, TREB said it was “legally and morally required to respect” the private information involved in real estate sales. The Competition Tribunal dismissed that case, but hearings began again in 2015 following a successful appeal by the Competition Bureau.
SOURCE: CBC NEWS

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