Toronto home sales caught fire in the first half of May, but at this frenzied pace, homeowners better hope that fire doesn’t burn everything down.
The latest numbers from the Toronto Real Estate Board suggest a market so strong that it might just be overheating: Sales volumes jumped 19.6 per cent compared to the first half of May in 2013, and prices followed.
The average cost to buy a house in Toronto, including condos, soared to $663,787, up 11.5 per cent in the space of a year. In the Greater Toronto Area, prices were up 8.9 per cent, to $542,047 on average.
Condo prices in Toronto were up 12.2 per cent, to just under $400,000 on average, while single-family homes jumped 13 per cent to $966,867. (By Teranet’s measure, single-family houses have already surpassed the 41 million mark.)
So is this a sign of a strong, healthy market or a sign of extreme overheating?
Compare those house prices to inflation, which was running at a 1.5-per-cent clip last time StatsCan checked, and to wage growth, which is clocking in at about 2.3 per cent per year. Toronto’s house prices are far out of proportion, and affordability is inevitably deteriorating.
Toronto’s real estate board isn’t sounding the alarm just yet. >>read full article HERE
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