Toronto buyers feel mortgage sting
February 14, 2018
Some are pointing to new federal mortgage regulations for a sharp slowdown in housing sales across the Greater Toronto Area (GTA) in January.
GTA resale housing transactions dropped 22 per cent in the month to 4,019 units, according to the Toronto Real Estate Board (TREB). It was the slowest month of sales for January since 2009. The average price of a home sold in the GTA was $736,783, down 4.1 percent from January 2017.
The tougher mortgage guidelines came into force on January 1, making it harder for prospective buyers to qualify for loans. Many buyers rushed into the market in December to get ahead of the rules, GTA agents said.
“It is not surprising that home prices in some market segments were flat to down in January compared to last year,” said Jason Mercer, TREB’s director of market analysis. “At this time last year, we were in the midst of a housing price spike driven by exceptionally low inventory in the marketplace.”
But TREB expects the market to improve.
“As we move through the year, expect the pace of home sales to pick up,” TREB president Tim Syrianos said in a statement.
“It is likely that market conditions will support a return to positive price growth for many home types in the second half of 2018,” Mercer said.