Residential construction sites may be up and active all over Toronto, but that doesn't mean the market is booming — far from it, according to experts, in light of the ongoing pandemic.
Building Industry and Land Development Association (BILD) CEO David Wilkes says that sales of newly-built and pre-construction homes have fallen across the entire GTA since COVID-19 hit, down a whopping 81 per cent year over year last month.
With only 866 new homes sold in May, this represents the lowest level of new construction home sales the Toronto region has seen since 2000.
"Sales centres weren't available for people to visit and look at new product," said Wilkes to The Star, noting that May was also "a period of people being encouraged to stay at home."
It's more than just buyer shyness impacting the new build market, though: The Star reports that most under-construction housing projects in the region are currently behind by an average of six months due to supply shortages, approval delays and worksite restrictions brought on by COVID-19.
New construction home sales in the Toronto region have hit the lowest level for May since 2000, down 81 per cent year over year, according to the home-building industry association. 20 years low #tore #torontorealestate https://t.co/2JcGRTNZeW
— Toronto Housing Market Bubble Facebook Group (@TorMrktBubble) June 25, 2020
And yet, despite the historic low sales numbers, prices are holding steady — and even going up in some cases — for newly-built residences.
Rents may be falling fast on account of COVID-19 in Toronto, but buyers (those who want to buy something brand spanking new or pre-construction, at least) don't seem to be having the same kind of luck.
New single-family house prices remained relatively flat in May of 2020, according to the BILD, at an average of $1.11 million. New condo prices, on the other hand, shot up 24.6 per cent, year over year, to reach an average of $984,436 in the GTA.
These trends are consistent with the local real estate market as a whole, with all types of home sales showing a marked decline since March and home prices rising or staying flat.
Wilkes says the market should rebound once the COVID crisis has cleared, but it could be at least nine months until what he calls a "return to normal" for the residential construction industry.
by Lauren O'Neil via blogTO
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