Sales of existing homes in the Greater Toronto Area in October were down 7.1 per cent from a year ago, but rose from this September.
Prices continue to climb, though the strength of price increases is petering out.
The trend is similar to what the Greater Vancouver Area has experienced, with home sales rebounding somewhat from September but still far below the levels of a year ago. But Vancouver is now seeing home prices slip.
There were 6,896 home sales in the Toronto area in October over the MLS system, according to the Toronto Real Estate Board. That’s 7.1 per cent lower than a year ago, but above the 5,879 sales reported for September.
The board noted that there were two more business days in October this year than last year, and on a per-business-day basis, sales were down 15.6 per cent from October, 2011.
Finance Minister Jim Flaherty tightened up the country’s mortgage insurance rules this summer, cutting the maximum length of insured mortgages to 25 years from 30, in a bid to prevent consumers from taking on too much mortgage debt and stop house prices from rising too high.
Earlier this week Deputy Minister of Finance Michael Horgan said it’s too early to link those rule changes, which took effect July 9, to the cooling that is occurring in the housing market. But a number of players in the real estate industry argue that the changes spurred the decrease in sales.
“Sales have decreased in the second half of this year compared to 2011, especially since the onset of stricter mortgage lending guidelines at the beginning of July,” Toronto Real Estate Board president Ann Hannah said in the press release that contains October’s sales figures. “The prospect of higher monthly mortgage payments due to the reduced maximum amortization period has prompted some households to delay their home purchase.”
It was condos that led the sales decrease again this month, with sales of condos in the downtown region covered by the 416 area code falling 14 per cent from a year ago, and those in the 905 region on the outskirts of the city falling 20 per cent. The average resale price of condos downtown fell two per cent, while those in the 905 rose four per cent from a year ago.
Sales of detached homes fell seven per cent downtown and one per cent in the 905. Prices held up, rising 5 and 8 per cent respectively, to $779,484 and $573,598.
The average selling price for all types of homes in the Greater Toronto Area during October was $503,479, up 6.2 per cent from a year ago. The MLS Home Price Index, which seeks to calculate more of an apples-to-apples type comparison that accounts for a shift in the types of homes being sold, was up 5.1 per cent.
Vancouver’s MLS Home Price Index fell 0.8 per cent in October from a year ago.