Greater Toronto Area real estate continues on its tear, as buyers already on the property ladder, or fortunate enough to scrape together enough for a down payment, continued to take advantage of rock bottom mortgage rates.
The Toronto Regional Real Estate Board (TRREB) says the average selling price jumped 21.6 per cent in March, versus the same month last year, to $1,097,565.
Sales set a record for the third straight month with 15,652 homes changing hands, which is nearly twice as many as March 2020 when COVID-19 was first declared a pandemic and home sales dropped dramatically.
Low-rise, single-family homes continued to lead the way while condos in the 416 area code lagged. TRREB says a lack of inventory for sale means the run-up may continue.
"With sales growth outstripping listings growth by a large margin, including in the condo market segment, competition between buyers in some market segments and the potential for double-digit price growth could continue without a meaningful increase in the supply of homes available for sale,” said TRREB chief market analyst Jason Mercer, in a release.
“This will become more apparent as population growth resumes over the next year."
The MLS home price index aims to smooth out distortions from a shift to higher-priced homes, and is up 16.5 per cent compared to last year. Regions outside of the core continued to lead the way with South Simcoe County up 35.6 per cent, and Orangeville tied with Durham at 32.8 per cent.
Rapid price appreciation has led to a number of economists and market watchers suggesting policies to curb demand. But TRREB says addressing supply is more important.
“Policies focussed on demand, such as a capital gains tax on primary residences, can have a short-term impact, but can also be fraught with unintended consequences like further stifling the supply of listings,” said TRREB CEO John DiMichele.
“The federal minister responsible for the housing portfolio has said his government will not entertain such a policy option, which is the right decision. We have been saying for too long now that policymakers must focus on the long-term goal of increasing housing supply in order to accommodate current and future demand.”
Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.