TORONTO – Toronto’s scorching real estate market continued to heat up last month, with sales hitting a record high even as prices continued to soar, the Toronto Real Estate Board said Thursday.
“It just really seems to be a continuation of the entire year that we’ve seen,” said Shawn Zigelstein, a sales representative with Royal LePage Your Community Realty.
“We’re not seeing a sign of any slowdown at this point.”
There were 9,768 properties sold in October, up 11.5 per cent from the same month last year, according to the latest figures from the real estate board.
That came as the average selling price for all types of homes rose to $762,975, a 21.1 per cent increase from a year ago.
“From what we’re seeing from the lack of supply, it doesn’t shock me that average prices have jumped once again,” Zigelstein said.
Rock-bottom interest rates have encouraged more buyers to step into the market and fight over the limited number of homes up for sale, Zigelstein said.
Even though the number of new listings grew last month to 13,377 — up 0.9 per cent compared with October last year — the increase was not high enough to offset the rise in sales volume, according to TREB’s director of market analysis Jason Mercer.
That made for an intensely competitive marketplace, said Zigelstein.
“You’ve got a group of pent-up buyers that are sitting there waiting and waiting and waiting,” Zigelstein said.
“Right now we’ve got a list of them. And basically as soon as something pops out in an area they go, ‘Okay, let’s go! We’re ready to go! We gotta go get this house.'”
The growth in home sales and prices came the same month Finance Minister Bill Morneau announced stricter rules for mortgage lenders and foreign buyers in an effort to stabilize hot housing markets such as Toronto and Vancouver.
The new measures require a stress test for all insured mortgages to ensure borrowers can still repay their loans in the event interest rates rise or their personal financial situations change. Before the change, stress tests had not been required for fixed-rate mortgages with terms of at least five years.
“As we move through November and December, we will be watching the sales and listings trends closely, in light of the recent policy changes,” Toronto Real Estate Board president Larry Cerqua said in a statement.
However, it could be several months before the full impact of the new rules is felt, Zigelstein said.
The record-high sales were in contrast to Vancouver, where home sales dropped 38.8 per cent last month compared with a year ago, according to the Real Estate Board of Greater Vancouver.
The composite benchmark price for all residential properties in Metro Vancouver was $919,300 last month, down 0.8 per cent from September.
Vancouver board president Dan Morrison said government interventions were partly behind the declines.
In August, the B.C. government implemented a 15 per cent tax on foreigners buying homes in Metro Vancouver.
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Note to readers: This is a corrected story. An earlier version incorrectly stated that stress tests were not required for fixed-rate mortgages longer than five years.