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May sees sharp decline in Toronto housing prices

June 5th, 2017  |  Home

Things may never get back to 'normal' on the Toronto housing front, but if the developments of the past month are any indication, then the market could finally be starting to level out.

Data shows that there was a six per cent drop in the average Greater Toronto Area (GTA) home sale price from April to May. From a volume of sales standpoint, there was a staggering 20.3 per cent drop in numbers from May 2016 to this most recent month.

What's notable about the data—besides the sheer Recession-esque steepness of the declines—is that these results are the first for which the new Ontario housing measures had been in effect for an entire month. Those policies went live in April, aimed at cooling the market by introducing a foreign buyer's tax and establishing penalties for vacant properties.

Whether or not these effects can be viewed as a direct result of those changes or simply a reflection of other factors remains to be seen. Regardless, the shift from a $920,791 average sale price to an $863,910 one will be appreciated by buyers who have been stalled for months in landing an affordable home.

It may be that the lowered prices can be at least partially equated to an increased supply, as the number of GTA listings rose from 21,630 to 25,837—a 49 per cent spike from the 17,356 available in May 2016.

Though it's unlikely that Toronto will be able to fully sustain this rate of cooling, continuing on this trajectory would be a considerable accomplishment for a city that suddenly found itself mired in a full-on housing affordability crisis.