The Toronto Regional Real Estate Board says the pace of sales and home prices eased in June as Covid-19 cases subsided, but a heated start to the year still pushed it to upgrade its annual forecast.
The real estate board said Tuesday that 11,106 homes were sold last month, down from 11,951 in May but up from 8,645 last June.
The average selling price of a home in June was $1,089,536, a drop from $1,108,453 the month before and an increase from $931,131 a year ago.
The numbers signalled a continued cooling in the Ontario market from the end of 2020 and start of 2021, when sales and prices were routinely breaking records every month despite the pandemic.
“The record pace of sales has run its course as pent-up demand has increasingly been satisfied in the absence of normal population growth,” TRREB chief market analyst Jason Mercer said in a release Tuesday.
Mercer’s comments reflected that homebuyers had fewer properties to chose from in June as the number of new listings decreased by almost 13% to 16,189 in June from 18,586 in May. They totalled 16,208 in June 2020.
TRREB president Kevin Crigger said June highlighted that the market has moved from a record pace to a “robust” one over the last three months.
“While this could provide some relief for homebuyers in the near-term, a resumption of population growth based on immigration is only months away,” he warned.
The easing is welcome news for buyers who have bemoaned the market’s pace, but the region’s housing conditions are still among the hottest in Canada and TRREB is predicting that won’t soon change.
The board upgraded its forecast on Tuesday to capture the first quarter’s unexpected and frenzied pace. It now predicts 2021 will deliver 115,000 home sales with an average price of $1,070,000.
It previously predicted 2021 would bring 105,000 transactions with an average selling price of $1,025,000.
“A persistent lack of inventory across most segments of the market will keep competition between buyers strong, resulting in an average selling price well above $1 million through the end of 2021,” said Mercer.
The original forecast released in February was based on a view that showed the regional economy would improve from Covid-19 troubles and very low borrowing costs would continue to fuel strong demand, the board said.
TRREB felt this demand would ebb in 2021 because of stalled population growth stemming from pandemic-related closures, which are starting to be lifted.
The board now feels sales have peaked this year because it is no longer reporting records being broken, but wanted to upgrade the forecast to account for year-over-year sales continuing to outpace new listings growth.