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Real Estate Market Update for January 2018
Durham Region Association of REALTORS® (DRAR) President Dennis Roberts reported 470 residential transactions in January 2018, a slight decrease from December 2017. January saw an increase in listings of 954 from 711 in December. There is 30 per cent increase year-over-year from January 2017, where there were 735 listings. “Amid the new mortgage ‘stress test’ rules for buyers that came into effect January 1st, there has been a drop in sales but an increase in listings.” stated Roberts. Toronto Real Estate Board President Tim Syrianos announced that Greater Toronto Area REALTORS® reported 4,019 residential transactions through TREB’s MLS® System in January 2018. This result was down by 22 per cent compared to a record 5,155 sales reported in January 2017. The number of new listings entered into TREB’s MLS® System amounted to 8,585 – a 17.4 per cent increase compared to 7,314 new listings entered in January 2017. However, it is important to note that the level of new listings was the second lowest for the month of January in the past 10 years.
Roberts’ goes on to say that January’s average selling price was $578,645, which is a stable increase from the previous month, and a minor decrease over the same month in 2017 at $608,417. Homes were sold within an average of 30 days on market for January 2018, in comparison to 15 days in January 2017. However, we still have strong pricing with 98 per cent Sale Price to List Price (SP/LP) and a healthy Sales to New Listing Ratio (SNLR) of 49.3 per cent, further indicating that Durham Region continues a strong, balanced market.
The MLS® Home Price Index Composite Benchmark was up by 5.2 per cent year-over-year. Syrianos says this annual rate of growth was driven by the condominium apartment market segment, with double-digit annual growth versus the single-family segment, with prices essentially flat compared to last year. The overall average selling price was down by 4.1 per cent year-over-year to $736,783. This decline was weighted toward the detached segment of the market. In the City of Toronto, the average selling price was up for all home types except for detached houses.
“The new ‘stress test’ rules require that borrowers qualify for mortgages at interest rates 2 per cent higher in order to still afford their monthly payments should interest rates rise,” said Roberts. “This was expected to moderate demand by qualifying loans more firmly, which has lowered the amount buyers can finance.”
“It is not surprising that home prices in some market segments were flat to down in January compared to last year. At this time last year, we were in the midst of a housing price spike driven by exceptionally low inventory in the marketplace. It is likely that market conditions will support a return to positive price growth for many home types in the second half of 2018. The condominium apartment segment will be the driver of this price growth,” said Jason Mercer, TREB’s Director of Market Analysis.
“Our strong local economy and expected population growth will result in sustained household growth in Durham Region,” said Roberts.
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