New construction home sales in the Greater Toronto Area hit the lowest number in April in more than 20 years, says the association representing new homebuilders. National home sales via Canadian MLS® Systems, meanwhile, dropped by 2.9% that month.
Single-family home sales accounted for 502 of the 1,727 new home sales – a drop of 65 per cent from April 2017 and down 70 per cent from the 10-year average, Altus Group reports. Condominium apartments accounted for 1,225 new home sales, down 65 per cent from April 2017 and down 38 per cent from the 10-year average.
Newly-built single-family home prices dropped five per cent year over year to $1.15 million, down from about $1.2 million in March, says the Building Industry and Land Development Association. The benchmark price for condos continued to rise – 29.8 per cent year over year to $739,965 but down month over month from $742,801.
“While home-buying intentions remain strong, a combination of challenges is keeping many interested buyers out of the new home market this spring,” says Altus Group’s Patricia Arsenault. “First-time buyers need to save longer to qualify for a mortgage and potential move-up buyers are faced with a bigger gap than a year ago between the price of a newly-built home and the price they can get for their existing home.”
On the resale market, activity was down 13.9 per cent compared to April of last year and hit a seven-year low for the month. It also stood 6.9 per cent below the 10-year average for the month. “The stress-test that came into effect this year for homebuyers with more than a 20 per cent down payment continued to cast its shadow over sales activity in April,” says Canadian Real Estate Association President Barb Sukkau. “Its impact on housing markets varies by region.”