Strong demand continues while prices level off
July home sale prices were released by TREB today. The 7,922 sales reported in the Toronto area represent a 23% increase over July 2010; while the average sale price of $459,122 is more than 9% above the corresponding figure from a year ago.
Prices are still being driven by demand, even though the usual seasonal pattern is evident. The chart above shows how monthly prices increased through the spring of 2011 and declined in the last two months. The dotted line represents the typical month-over-month variation in Toronto home prices, based on the past 15 years.
Several market areas in the City of Toronto have been chronically short of listings over the past 18 months. This has led to situations where some homes received bids that were more than 10% or even 20% above the listed price.
“Tight market conditions have boosted the annual rate of price growth this year,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “However, the listings situation is starting to improve. A better supplied market later this year and into 2012 would lead to a more sustainable rate of price growth.”