New figures released by Building and Land Development Association (BILD) show that builders are adapting to moderating housing prices in the Greater Toronto Area by producing a broader selection of new construction homes at lower price points. The move has helped to boost sales above last year’s historic lows, with sales of newly-built homes up 20 per cent year over year in March. Single-family homes — a category that includes detached, semi-detached and townhouses — saw a 7.6 per cent price decline compared to March 2018, but a near-200 per cent increase in sales, from 311 a year earlier to 886. The benchmark price for those homes was $1.117 million last month, compared to $1.207 million a year earlier.

Condo prices continued to rise by a moderate 5 per cent — about $38,000 — to a $780,839 benchmark, with sales declining 13 per cent year over year in March, according to the industry statistics compiled by Altus Group. BILD CEO David Wilkes warned that the Toronto region still faces significant challenges in meeting its housing supply and affordability needs. “I don’t think we should take great comfort in the uptick and take our focus off the goal of fixing our long-term supply challenges,” he said. The 2,314 condos and single-family home sales represented a 20 per cent increase over the 1,960 sold in March 2018, but single-family home sales were still 38 per cent below the 10-year average despite five consecutive months of year-over-year increases. “We are lapping an historically low year. We’re seeing the green shoots of the activity increasing but we still have a long way to go to get back to 10-year averages,” said Wilkes.

The data show that the home construction industry is responding to the market by building more of the mid- and low-rise apartments, stacked townhomes and row houses that studies have shown the region needs to facilitate affordability and density. “Those types of products are providing an entry point to first-time buyers at a price point they can afford. You’re seeing some change driven by market forces,” he said. Affordability and the growth of higher density neighbourhoods have proven to be among the most popular topics in BILD’s question-and-answer public awareness campaign launched last month. Consumers can submit their own questions about the level of development, builder profits and the high cost of housing at the “Building Answers” website.

Source: The Toronto Star