Strong Sales and Price Increases in 2019
According to the Toronto Real Estate Board, in 2019, we experienced a strong sales increase up against a decline in supply. Tighter market conditions translated into accelerating price growth. Expect further acceleration in 2020 if there is no relief on the supply front.
For December 2019, residential sales reported through TREB’s MLS® System by Greater Toronto Area REALTORS® were up by 17.4 per cent year-over-year to 4,399. Total sales for calendar year 2019 amounted to 87,825 – up by 12.6 per cent compared to the decade low 78,015 sales reported in 2018. On an annual basis, 2019 sales were in line with the median annual sales result for the past decade. There was a recovery in sales activity in 2019, particularly in the second half of the year. As anticipated, many home buyers who were initially on the sidelines moved back into the market place starting in the spring. Buyer confidence was buoyed by a strong regional economy and declining contract mortgage rates over the course of the year.
While sales were up in 2019, the number of new listings entered into TREB’s MLS® System was down by 2.4 per cent year-over-year.
At the end of December, only 2.1 months of inventory were available for sale. Industry insiders view anything under 4 months as tight supply and a sellers’ market, 4 to 6 months as balanced market and above 6 as a buyers’ market.
Brampton prices rose to $747,417 (up 7.4%) over December of 2018. This was driven by strong increases across most housing types.
There is very little supply of homes as only 0.9 months of inventory was on hand at the end of December compared to 2.4 months of inventory on hand at the same time last year. This tight supply will continue to create upward pressure on average prices moving forward.
Days on market have improved to 23 from 27 at the same time a year ago.
The number of homes trading hands rose dramatically (27.2%) to 482, resulting in an 18.8% increase in activity for the full year 2019 compared to 2018.
Mississauga market showed significant momentum. Average prices increased an 18.6% to $799,593 while and number of homes sold increased by 8.9% compared to December of 2018. The momentum, which started building in March, pushed 2019 annual activity 11.8% higher than 2018.
This improvement in prices was a direct result of the significant tightening of supply of homes available for sale of only 1.4 months. This level of supply will continue to put upward pressure on price moving forward.
Days on market for the month of 25 was also a noticeable improvement over December of 2018 value of 29 days.
Average price of $993,911 increased slightly (1.5%) from the same time last year. Activity increased by 7.0% to 46 homes and pushed the year to date activity to 988 homes (up 14.8%).
Days on market of 39 increased from the 35 days on market experienced during December 2019.
Milton market finished a strong average price of $787,929 which was up 9.0% over December 2018. Activity for the month of 80 homes was down 12.1% compared to November of 2018, however, sales for the year of 2,210 were up 17.6% over 2018.
Supply is among the shortest in the GTA at 1 month of inventory on hand, and thus should continue to create upward pressure on average prices moving forward.
Days on market improved to 23 from 28 experienced in December of 2018.