Toronto area home sales rebounded by 12 per cent from September to October, pointing to a stronger fall market after a policy-driven pullback from a frenzied market that peaked earlier this year.
While the number of transactions was still down relative to last year's record pace, it certainly does appear that sales momentum is picking up.
The average selling price in October was $780,104, up less than one per cent from September but up 2.3 per cent compared with October 2016. Price growth was driven by appreciation in the townhouse and condo segments.
The average price of a townhouse in the GTA was up 7.4 per cent at $629,507, while the average condo price was $523,041 up 22 per cent year-over-year, the most of any housing type. Meanwhile, the average price of a detached home was down 2.5 per cent year-over-year at $1 million. Prices of semi-detached homes rose 6.3 per cent to $764.293.
Sales in the first 10 months of the year slipped to 80,198, down 19 per cent from the same period in 2016. Sales have dropped more than 10 per cent from the record set in March before Ontario announced its housing plan.
In addition, the Bank of Canada has raised interest rates twice in recent months to the current overnight rate of one per cent, signalling a clampdown on cheap borrowing and driving the big bank prime rates and the cost of variable-rate mortgages higher. The cost of new fixed-rate mortgages have also risen as yields on the bond market have also risen.
Meanwhile, the Office of the Superintendent of Financial Institutions will implement new lending guidelines at the beginning of next year Among the changes being considered is a requirement that homebuyers who do not require mortgage insurance still have to show they can make their payments if interest rates rise..