GTA new home market strong in May though inventory remains at historic lows

The GTA new home market continued strong in May, with total sales and condominium unit sales above the 10-year average, the Building Industry and Land Development Association (BILD) reports.

Total new home sales in May, with 3,661 units sold, were five per cent above the 10-year average, according to Altus Group, BILD’s official source for new home market intelligence.

Condominium units, including those in low-, medium- and highrise buildings, stacked townhouses and loft units, accounted for 2,396 new home sales in May, 10 per cent above the 10-year average.

Chronic shortages

Sales of new single-family homes, including detached, linked and semi-detached houses and townhouses (excluding stacked townhouses), with 1,265 units sold, were three per cent below the 10-year average.

“The low inventory levels reported in the May data underline the need for GTA municipalities to address chronic shortages of housing supply,” says Dave Wilkes, BILD president and CEO. “Municipalities need to speed up approvals of shovel-ready projects, and as we look ahead to continued population growth in the GTA, they need to evaluate all aspects of the development approvals process to ensure that the new homes the region needs are being built in a timely manner.”

Frenzied pace

“While sales of new condominium apartments were lower in May than the frenzied pace of the previous two months, they were still above the 10-year average for May as demand remains buoyant and activity settles into more sustainable levels,” adds Ryan Wyse, Altus Group’s manager, analytics, Data Solutions. “Buyers continue to be attracted to new openings, with about half of the newly released units available for purchase before the last 10 days of May selling within the month.”

Total new home remaining inventory was 12,555 units in May. That number represents 3.3 months’ worth of inventory based on the current pace of sales, but a balanced market would have nine to 12 months of inventory. Remaining inventory includes units in preconstruction projects, in projects currently under construction, and in completed buildings.

The benchmark price for new condominium apartments increased in May compared to the previous month, to $106 million, an increase of eight per cent over the last 12 months. New single-family homes decreased compared to the previous month, to $1.38 million, up 24.4 per cent over the last 12 months.