Toronto’s real estate market remains hot, but shows first signs of cooling

Home sales for the Greater Toronto Area remained strong in April, but the market is starting to slow from the intense pace seen earlier this year, the Toronto Regional Real Estate Board said Wednesday.

The board revealed 13,663 homes were sold in the region last month, a 362 per cent increase from the 2,957 properties sold in April 2020, which was the first full month of the COVID-19 pandemic.

However, home sales this April were down 12.7 per cent, from 15,652 in the month prior.

While sales remained strong, TRREB president Lisa Patel called this a “marked slowing” and said it signals a pullback in activity in a market that has been overheating since last year, despite the ongoing health crisis.

“We’ve experienced a torrid pace of home sales since the summer of 2020, while seeing little in the way of population growth,” she said in a release.

“We may be starting to exhaust the pool of potential buyers within the existing GTA population.”

Patel’s remarks came as TRREB said new listings in April soared by 237 per cent compared with last year but dropped by 8.4 per cent when compared with March 2021.

The average selling price was $1,090,992, up 33 per cent from $820,226 last April, but down from $1,097,565 in March 2021.

Stark contrast with previous years

The decrease between March and April was a stark contrast to previous years when average prices typically increased between the two months and signalled the start of a flurry of spring sales.

However, TRREB’s chief market analyst Jason Mercer described the decrease seen this year as “modest slowing” and pointed out that prices across all major home types remain very high.

They were boosted in recent months by low borrowing costs during COVID-19, which sparked demand for housing, he said.

“While the pace of price growth could moderate in the coming months, home prices will likely continue on the upward trend,” he said in a release.

“Renewed population growth over the next year coupled with a persistent lack of new inventory will underpin home price appreciation.”

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