Homes become unaffordable in GTA as prices jump 17.4% on short supply

Canada housing crisis is rooted in short supply as listings drop by 43 percent since last year, pushing average price in GTA to$1,070,911 from $951,219 last year 

The Canadian Bazaar

TORONTO: The Toronto Regional Real Estate Board (TRREB) said on Friday that the demand for housing is rising so much that the supply simply cannot match it.

New listings are down by 43 per cent year over year. The resulting short supply and competition between buyers has caused a double-digit annual increase in selling prices.

In August, listings were down to 10,609 from 18,599 in August 2020 –  43 per cent fall.

The Toronto board says the Greater Toronto Area reported 8,596 sales in August 2021 – down by 19.9 per cent from the August 2020 record of 10,738. 

But the condo market segment has reported year-over-year growth in sales, continuing in 2021. 

The average home price in Toronto has jumped 17.4 per cent since last year –  $1,070,911 in August 2021 from $951,219 in August 2020. 

In the 905 region, the average home price has reached $1,108,981 in August 2021 –  up from $923,204 in August 2020.

The Toronto Regional Real Estate Board has warned the price trend will become even worse once immigration into Canada restarts.

“The supply of homes is not keeping pace with demand, and this situation will become worse once immigration into Canada resumes,” says board president Kevin Crigger.

“Working with provincial and municipal levels of governmenton solving supply-related issues is much more important to affordability than interfering with consumer choice during the home buying and selling offer process or revisiting demand-side policies that will at best have a short-term impact on market conditions,” he says.

The real estate board’s chief market analyst Jason Mercer warns that there will no relief in prices as competition between buyers increases.  

“As we move toward 2022, expect market conditions to become tighter as population growth in the GTA starts to trend back to pre-COVID levels,” he says.

The board has asked all election-bound political parties to address supply and affordability across the country. 

“Bold action, not promises, are needed to ensure that Canada has a stable and sustainable housing market now and in the decades to come. This will ensure that the Greater Golden Horseshoe remains competitive on the global stage, in terms of attracting businesses and households to the region,” says Toronto Regional Real Estate Board CEO John DiMichele.