According to The Toronto Star, The Greater Toronto Area (GTA) has seen a significant decline in sales of newly built homes in May, with a 71% drop compared to last year. According to a report by Altus Group analysts and the Building Industry and Land Development Association (BILD), only 936 new homes were sold in May, consisting of 539 condominium units and 397 single-family homes. This drastic decrease has raised concerns about the future of housing supply in the region.
A Deeper Dive into the Numbers
The report highlights a 75% drop in new condo sales and a 65% decline in single-family home sales compared to May 2023. Despite a slight easing of prices, new condos still cost over $1 million, and single-family homes are priced at around $1.6 million. These prices make it difficult for average families to purchase homes, with high down payments and monthly mortgage payments exceeding $5,000.
The Impact on Housing Supply
The slowdown in sales has resulted in an increase in new home inventory, with 20,427 new homes on the market in May. However, at the current sales pace, this inventory is expected to last for 14.5 months. BILD executive Justin Sherwood warns that this trend may lead to fewer homes hitting the market in the coming years, resulting in higher prices and less choice for buyers.
Expert Insights
Sherwood notes that the industry is already seeing a slowdown in housing starts, which will only accelerate in the coming months. He also believes that a significant drop in home prices is unlikely, citing factors such as limited land supply, higher construction costs, and increased labour costs.
What This Means for Homebuyers
As the housing market continues to shift, homebuyers may face higher prices and fewer options in the coming years. It’s essential for buyers to work with experienced professionals, like our team at Cruz Financial Group, to navigate the complex housing market and find the right mortgage solutions.
Get Personalized Mortgage Solutions
At Cruz Financial Group, we understand the challenges of navigating the complex housing market. Our experienced team is dedicated to providing personalized mortgage solutions to help you achieve your homeownership goals. Contact us today to learn more about our services and how we can assist you in finding your dream home.
Don’t Let the Market Intimidate You
With the right guidance and support, you can still achieve your homeownership dreams. Our team is here to help you every step of the way, from pre-approval to closing. Let us help you navigate the GTA housing market and find the perfect home for you.
