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Toronto area home sales fell sharply in November as new listings plunged, leaving dwindling inventory and growing competition in hot neighbourhoods.

The Toronto Real Estate Board (TREB) said the number of homes sold in the Greater Toronto Area fell 14.7 per cent in November compared with the same month last year. Part of the drop was owing to an unusual spike in sales in November last year, when buyers hurried to close deals before tougher new mortgage stress-test rules took effect on Jan. 1, TREB said.

November sales fell 3.4 per cent compared with October on a month-over-month basis after adjusting for seasonal variations.

The sales decline was also owing to a 26.1-per-cent drop in new listings in November compared with last year as many potential sellers sat on the sidelines amid a lukewarm GTA market.

The decline in inventory helped push home prices up 3.5 per cent in November on a year-over-year basis to an average of $788,345 for all types of homes, TREB said. The average sales price was virtually flat in November compared to October, TREB said, down just 0.8 per cent on a month-over-month basis.

“New listings were actually down more than sales on a year-over-year basis in November,” TREB president Garry Bhaura said in a statement. “This suggests that, in many neighbourhoods, competition between buyers may have increased.”

New listings also fell in September and October compared with the same months last year, and Mr. Bhaura said the relatively tight market conditions “have provided the foundation for renewed price growth” in the GTA.

Detached home prices have stabilized in the Toronto region in recent months, but most of the price growth continues to come from condominiums.

Condominiums sold for an average of $556,723 in November, up 7.5 per cent compared with the same month last year, while the average detached home sold for $1,008,768, an increase of 1.3 per cent over November, 2017.

Semi-detached home prices rose 8.3 per cent and townhouse prices were up 3.1 per cent in November compared with last year, TREB said, but both account for a much smaller volume of total sales than detached houses and condominiums.

Jason Mercer, TREB’s director of market analysis, said condos and semi-detached homes are generally less expensive, and are in growing demand from buyers who cannot afford pricier homes because of the new mortgage stress-test rules.

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