The new home market in the Greater Toronto Area (GTA) has been somewhat lacklustre in 2022, and March was no exception. However, the Building Industry and Land Development Association (BILD) reported that the segment picked up almost 40% in March, with 1,277 sales recorded, up from 925 in February. The figure is still 70% lower than in March 2021 and 65% below the 10-year average, but it suggests that the market may be starting to recover from the pandemic.
Altus Group analytics, used by BILD, showed that more than half of March’s sales were in condominium apartments, stacked townhouses, and loft units, with 893 units sold. However, this figure is down 73% from the previous year and 63% below the 10-year average. Meanwhile, only 384 sales were recorded in the single-family home segment, down 57% from March 2021 and 67% below the 10-year average.
Despite the sluggish sales, new home inventory was slightly lower in March than in February but posted gains compared to the same month last year, totalling 14,479 units. Of those units, 12,887 were condominium apartment units, representing around 10.5 months of inventory based on average sales for the past 12 months. The remaining inventory included 1,592 single-family units, equivalent to around 6 months based on average sales for the past 12 months. According to the report, a balanced market has 9 to 12 months of inventory.
BILD President and CEO Dave Wilkes expressed confidence that “muted” sales over the past few months will soon give way to a strong demand “as GTA families resume looking for the homes they need.” The assertion is supported by Edward Jegg, Research Manager with Altus Group, who noted that March’s numbers bode well for the months ahead. Jegg pointed out that the new home market remains poised for an upswing as inventory levels are robust and interest rates are holding fast, causing buyers to re-emerge from the sidelines.
The trajectory of benchmark prices for single-family homes and condominium apartments indicates an increase in March despite a 2.1% and 10.8% slip, respectively, compared to the last 12 months. The benchmark price for single-family homes was $1,799,971, while condominium apartments was $1,117,867.
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The GTA new home market experienced a boost in March, with a near-40% increase in sales.
