Year End Market Update - Sales Volume Down Slightly - Average Prices Up

Market Update

January 6, 2011 --

With 4395 existing home sales reported for the month of December, the 2010 total sales of 86,170 by Greater Toronto REALTORS® is down one per cent compared to 2009.

"At the outset of 2010, we were experiencing annual rates of price growth at or near 20 per cent. This was the result of extremely tight market conditions coupled with the fact that we were comparing prices to the trough of the recession at the beginning of 2009," said Jason Mercer, TREB's Senior Manager of Market Analysis.

"Balanced market conditions in the second half of 2010 resulted in more moderate home price appreciation," continued Mercer. "Expect the average selling price to grow at or below five per cent in 2011. With this type of growth, mortgage carrying costs for the average priced home in the GTA will remain affordable for a household earning an average income."

Average and Median Prices in December Up Over 2009

The average home selling price in 2010 of $431,463 is up nine per cent in comparison to the 2009 average selling price of $395,460.

In December, the median price was $355,000, up from the $349,000 recorded during December of 2009

"Market conditions were anything but uniform in 2010. We went from super-charged sales activity during the first four months of the year, to a marked drop-off in transactions in the summer and then in the fall saw sales climb back to levels that are sustainable over the longer term," said TREB President Bill Johnston.

"New Federal Government-mandated mortgage lending guidelines, higher borrowing costs and misconceptions about the HST caused a pause in home buying in the summer. As it became clear that the HST was not applicable to the sale price of an existing home and buyers realized that home ownership remained affordable, market conditions improved," continued Johnston.

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