Last month was the slowest August in 10 years for condominium sales in the Greater Toronto Area, with sales down 18 per cent from a year ago, according to a recent report from RealNet, a market research firm for the housing industry.
There were 663 high-rise units sold in August, which is almost 46 per cent fewer than the 10-year average.
"That represents the lowest high-rise August of the last 10 years," said RealNet analyst Steve Hurst, in a presentation of the data on the firm's website.
Sales of low-rise homes, by comparison, were up 32 per cent in August. But they, too, were down from the 10-year average — by 43 per cent. There were 777 sales of low-rise homes in the GTA in August, the third slowest month in 10 years.
Fewer unsold high-rise homes
Overall, home sales were up 3.7 per cent over last year, but 44 per cent lower than the 10-year average. Year-to-date sales of new homes were at their lowest level in a decade, with a total 16,775 units sold by the end of August. There were 28,275 new units left unsold, which was still well within the 25,000 to 35,000 historical norm, Hurst said.
The good news, Hurst said, is that the number of unsold high-rise units declined for the fourth straight month, falling to 21,028 units in August.
"That's down over 10 per cent since May … mostly thanks to a lack of new supply coming to market over the last several months," Hurst said.
"We'll see if that changes in the fall."
Low-rise prices at record high
Prices of low-rise homes reached a new record high in August of $658,938, an increase of 8.1 per cent over a year ago. The prices of high-rise homes remained flat, rising only 0.1 per cent in the past year to $436,789.
"Constrained land supply has severely diminished inventory in the low-rise sector, bringing prices to a considerable increase," said Bryan Tuckey, president of the Building Industry and Land Development Association, in a commentary on the RealNet numbers.
"Another factor is the rising government fees and charges which, on average, add up to one-fifth of the cost of a new home."
The price gap between low-rise and high-rise homes is the widest it has been since RealNet started compiling data as the two housing categories continued to move in opposite directions, Hurst said.
"From 2004 to 2011, the price difference between low rise homes and high rise homes averaged about $75,000. During the last two years, however, that price gap has been growing — steadily — to a gap that at the end of August reached a new record high of $222,000," Hurst said.
"The bottom line: the price of home types we're making more of is flattening, and the price of home types we're making less of is rising."