Ontario real estate is seeing inventory hit a high for the year. Numbers from the Real Estate Board of Greater Ontario (REBGV) show that a decline in sales is causing listings to build at a rapid rate. Despite soaring inventory, prices still climbed more than the Ontario median family income year-over-year.
Prices Increased 2.1%
The benchmark price of composite homes, your typical Ontario home, made a pretty big move higher. The composite price is now $1,019,400, a 2.1% increase from the month before. This represents a 9.57% increase from the same month last year, which works out to $89,000. The market may be cooling, but if you’re the median family – your house still likely made more than you. This is the first time the composite price has hit over a million.
Sales Decreased 23.97%
Sales are showing big declines, but the seasonal drop was smaller than the year before. July 2017 saw 2,960 sales, a 23.97% decline from the month before. This is 8.25% lower than the same month last year. The monthly drop seems huge, but there’s a seasonal drop this time of year in Ontario. For a little context, the same period last year saw a 26.6% decrease.
Listings Increased Over 7%
Listings are the big story, and REBGV would likely agree. There were 9,194 homes listed for sale at the end of July 2017, a 7.97% increase from the month before. This is 10.9% higher than the same month last year. Higher inventory isn’t a problem by itself, but when combined with declining sales – it theoretically should provide downward pressure on prices.
Jill Oudil, president of the REBGV, noted “Because home sale activity decreased to more historically normal levels in July, the selection of homes for sale in the region was able to edge above 9,000 for the first time this year.” Which is real estate executive for people aren’t buying homes as quick as people are selling them, so they’re piling up.
It appears that Ontario is the land that math forgot. Increased inventory, and declining sales typically results in reduced pricing pressure – but prices still climbed. This bucking of traditional housing economics isn’t too surprising, considering the recently revealed history of Ontario of real estate.