For the Greater Toronto Area (GTA), the housing market in February 2021 was rather promising for buyers since their employment remained in safer hands and took advantage of low-interest costs.
According to GTA REALTORS®, there were 10,970 sales through TRREB’s MLS® System in February 2021, showing a hike of 52.5% compared to 7,193 sales reported in February 2020. Condos proved to be the most prominent types of houses, witnessing a sales hike of around 64% compared to the same month of 2020.
Although it’s worth mentioning here that after COVID-19 hit the country, condos were the least to witness sales activity growth. The most common types of homes for the rest of the year (Q3 and Q4) were single-family homes.
Having said that, the rise in transactions condos have seen in the previous month could be a sign of a stabilizing housing market.
As evident from the image, townhouses saw maximum growth in sales prices of 29% compared to Feb’20. According to the Canada Mortgage and Housing Corporation (CMHC), “for a purchase price of $500,000 or less, the minimum down payment is 5%. When the purchase price is above $500,000, the minimum down payment is 5% for the first $500,000 and 10% for the remaining portion.” This means the average mortgage on townhouses remained around 7.5%.
On the other hand, the condo prices didn’t increase at all. Instead, they fell by around 4% compared to Feb’20. This is because there has been a low demand for condos compared to other types of houses.
Exploring further, we have a detailed list of properties sold according to the type of home and price range. We’ll be looking into the four major types only.
Explaining the rising trend in demand from homebuyers, TRREB President Lisa Patel said:
It’s clear that the historic demand for housing experienced in the second half of last year has carried forward into the first quarter of this year with some similar themes, including the continued popularity of suburban low-rise properties. It’s also evident that the supply of listings is not keeping up with demand, which could present an even larger problem once population growth picks up following widespread vaccinations later this year and into 2022,
What to do When Inventory is Low?
We all know that the required supply of houses remains low in the market, but not for condos. Condos are abundantly available for buyers. But since we have seen such a massive surge in sales activity in the previous month, it’s more likely that the demand would continue to pace up. And there could be a time that the market for condos turns its sides, i.e., from a buyer’s market to the seller’s market.
If you are also looking for a condo, we at Condo Point would love to work with you. We keep our listings up-to-date. And also work on pre-construction projects to help you find new inventories with the latest designing trends.
Data Source: TRREB