August 2024 new home sales in the GTA hit historic lows

Toronto, Sept. 19, 2024 (GLOBE NEWSWIRE) -- Greater Toronto Area, September 19, 2024 – Greater Toronto Area (GTA) new home sales in August hit historic lows sales and very few new project releases, the Building Industry and Land Development Association (BILD) announced today.

There were 464 new home sales in August which was down 46 per cent from August 2023 and 73 per cent below the 10-year average, according to Altus Group*, BILD’s official source for new home market intelligence.

“August new home sales across the GTA continued to be weak, leading to elevated inventory levels,” said Edward Jegg, Research Manager with Altus Group. “With most new homes taking months to construct, buyers can take advantage of current pricing and the future prospects for affordability improvements arising from mortgage rate declines that are expected to fall even further and the changes to mortgage rules set to come into effect later this year.”

Condominium apartments, including units in low, medium and high-rise buildings, stacked townhouses and loft units, accounted for 235 units sold in August, down 61 per cent from August 2023 and 81 per cent below the 10-year average.

There were 229 single-family home sales in August, down 14 per cent from August 2023 and 56 per cent below the 10-year average. Single-family homes include detached, linked and semi-detached houses and townhouses (excluding stacked townhouses).

Total new home remaining inventory decreased slightly compared to the previous month, to 21,296 units. This includes 17,233 condominium apartment units and 4,063 single-family dwellings. This represents a combined inventory level of 14.5 months, based on average sales for the last 12 months. This is a high inventory level, maintaining the trend seen since autumn 2023 of remaining inventory levels near or just above the 20,000-unit mark. Months of inventory are staying high not because the number of new units coming to market is dramatically increasing, but rather because sales are continually decreasing. This is an unhealthy situation, because as interest rates decrease, sales will return but it will take longer for new building to recover, setting up a future supply/demand imbalance.

“August’s new home sales data paints a stark picture of a housing market that is struggling with deep structural issues that have made the cost to build too high. A key component of those costs are the excessively high government taxes and fees, which add, on average, $355,000 to the cost of an average single family new home in the GTA,” said Justin Sherwood, SVP Communications & Stakeholder Relations at BILD. “The crisis is real and will be reflected – in the next several years by - fewer jobs, fewer new homes and compounded affordability challenges. We are calling on municipalities across the GTA, supported by the provincial and federal governments to take immediate steps to address the fundamental challenges facing our industry by controlling and lowering the charges on new home construction. There is no greater issue facing our region than housing and we all have a responsibility and opportunity to take bold steps to change the channel on the affordability challenges facing our region”

Benchmark prices increased slightly in August for both single-family homes and for condominium apartments compared to the previous year. The benchmark price for new condominium apartments was $ 1,031,356, which was down five per cent over the last 12 months. The benchmark price for new single-family homes was $1,598,852, which was down seven per cent over the last 12 months.

With 1,200 member companies, BILD is the voice of the home building, residential and non-residential land development and professional renovation industries in the Greater Toronto Area. The building and renovation industry provides 256,000 jobs in the region and $39.3 billion in investment value. BILD is affiliated with the Ontario and Canadian Home Builders’ Associations.

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For additional information or to schedule an interview, contact Janis McCulloch at jmcculloch@bildgta.ca or 416-617-7994.

*Altus Group should be credited as BILD’s official source of new home market intelligence.

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