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The Toronto Real Estate Board (TREB) reports that last month 7,092 properties were sold in Toronto. This is an increase of 11% over November 2010. In November of this year, 9,786 new homes came onto the market. This is an increase of 14% over November 2010. The total number of available listings however, dropped by 15% from the 2010 level. The relative lack of product kept Buyers motivated, driving the average sale price from $437,494 to $480,421.
Market conditions continue to favour Sellers while still enabling Buyers with low borrowing costs. Favourable mortgage rates are expected to continue into the New Year. Since August 2011, the pace at which new listings have been coming to market has been accelerating. A more balanced market is predicted for 2012, with Buyers finding a greater choice of properties.
Lenders and borrowers are most comfortable when the homeowner spends not more per annum than 30% of gross income on mortgage and realty tax payments. This is known as the Affordability Index. According to TREB, Toronto’s Affordability Index is at 32%. Compare this to 1990, when the amount of household income needed to cover home ownership costs stood at 50%!
2011 was a buoyant year for Toronto’s real estate market. With an increase in supply and continuing affordability, 2012 should be a year that rewards both Buyers and Sellers.
Best Wishes for Success,
Peter
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