Annual home sales in the country’s largest real estate market hit a record high last year, according to the latest data from the Toronto Real Estate Board (TREB), as activity in the closely watched Vancouver market began to slow.
TREB said Thursday its members had 113,133 residential property sales through the MLS system in 2016, an increase of 11.8 per cent compared to the previous year.
That includes 5,338 sales in December – an increase of 8.6 per cent from December 2015, despite a tight supply of properties for sale.
“A relatively strong regional economy, low unemployment and very low borrowing costs kept the demand for ownership housing strong in the GTA, as the region’s population continued to grow in 2016,” TREB president Larry Cerqua said in a statement.
For the first time, the real estate board commissioned research firm Ipsos to conduct a survey on the activity by foreign buyers in the Toronto market.
The results of the online survey of 3,518 realtors, conducted between Oct. 6 and 21, suggested that 4.9 per cent of transactions in the Greater Toronto Area were with a foreign buyer.
The polling industry’s professional body, the Marketing Research and Intelligence Association, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.
TREB reported the average price of a home sold in the Greater Toronto Area soared to $730,472 last month, up 20 per cent from December 2015.
The board’s MLS house price index – which adjusts for the different types of properties – was up 21 per cent in December from a year earlier.
The board said upward momentum on pricing accelerated as the year progressed and the overall average selling price for the calendar year was $729,922 – up 17.3 per cent compared with 2015.
Another factor affecting prices was a constrained supply of active listings, which hit a 15-year low in December.
“Total new listings for 2016 were down by almost four per cent,” said TREB’s director of market analysis, Jason Mercer.
Mercer added that government rule changes and policy debates have focused on high demand but “what we really need is more policy focus on issues impacting the lack of homes available for sale.”
In October, the federal government made a number of changes aimed at stabilizing the country’s real estate markets, including requiring stress tests for all insured mortgages.
The stress test change is intended to ensure that Canadians don’t take on larger mortgages than they can handle, particularly in markets such as Toronto and Vancouver where affordability is stretched.
Toronto’s strong sales figures came a day after the Real Estate Board of Greater Vancouver reported that sales last year in the closely watched real estate market fell 5.6 per cent compared with 2015.
On Wednesday, the real estate board reported that the composite benchmark price for all residential properties in Metro Vancouver, as measured by the Multiple Listing Service home price index, was $897,600 last month.
The result represented a 2.2 per cent drop over the second half of 2016, but a 17.8 per cent increase compared with December 2015.