The new home building and development industry has had a slow start this year, says the Building Industry and Land Development Association. Following one of the biggest years ever for new homes in the GTA, sales of new homes were down in January and prices were mostly flat.
In 2015, in contrast, the average price of new homes hit record highs, particularly in the low-rise market (where the average price eclipsed the $800,000 mark for the first time ever). Last year was also the third-highest volume sales year on record in the GTA.
For January 2016, there were only 1,614 new homes purchased in the GTA, which is down 10% from the long-term average and 22% below January 2015. Prices remain relatively unchanged.
BILD president and CEO Bryan Tuckey attributes the dip to reduced inventory of new homes available for sale in January. “While the number of new projects launched in January was similar to last year, the number of actual units in these projects was significantly lower,” he explains. “You can’t sell what you don’t have, so fewer new homes brought to market means fewer sales.”
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The industry brought 1,379 new homes to market in January 2016, compared to 2,011 the same period last year.
And, sales of high-rise condominiums were 17% below the long-term average in January, while sales of low-rise homes were 5% below the average.
But, “It’s important to understand that one month does not a trend make,” says Tuckey. “The next few months will tell a more accurate story about the market with the introduction of additional new projects across the GTA.”
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