GREATER TORONTO, June 19, 2013 /CNW/ - Reduced affordability in the GTA's new homes market continues to impair sales, the Building Industry and Land Development Association announced today.
According to RealNet Canada Inc., BILD's official source for new home market intelligence, the 2,539 new home sales in May amounted to the lowest May on record. The decline was mainly driven by the low-rise market, which dropped to 33 per cent below the 10-year average - also a record low.
Constrained land supply, as well as rising government fees and charges, are two factors behind the diminishing affordability observed in the GTA market. A new BILD-commissioned study, conducted by Altus Group, revealed that on average, government fees and charges amount to more than one-fifth of the cost of a new home.
"The issue of home affordability poses a significant challenge for new home buyers in the GTA," said BILD President and CEO Bryan Tuckey. "Government fees and charges continue to increase across the region, making it increasingly difficult for our industry to build affordable, safe, complete communities for the 100,000 people and 50,000 jobs that come to the GTA every year."
Land supply for ground-related housing has also affected pricing with low-rise inventory levels at record-low levels - down 46 per cent since 2009.
The RealNet New Home Price Index showed a 6 per cent increase in the low-rise sector over May 2012, bringing the price to record-breaking $644,427. Pricing for high-rise homes has remained relatively stable for several months, declining by 2 per cent to $431,955.
A statistical video analysis of May new home sales are available for download. For additional information, contact Amy Lazar or Andrei Zaretski.
|May '13||Low Rise||High Rise||Total|
Source: RealNet Canada Inc.
With more than 1,400 members, BILD, formed through the merger of the Greater Toronto Home Builders' Association and Urban Development Institute/Ontario, is the voice of the land development, home building and professional renovation industry in the Greater Toronto Area. BILD is proudly affiliated with the Ontario and Canadian Home Builders' Associations.
SOURCE: Building Industry and Land Development Association
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