The average price of a new low-rise home in the Greater Toronto Area is inching closer to the million-dollar mark.
Figures released today by the Building Industry and Land Development Association (BILD) show record-breaking prices for detached and semi-detached houses and town homes, with prices increasing more than $100,000 in 12 months.
In July, the average price of new detached and semi-detached homes in the GTA was $906,508, a 12 per cent increase from the year before.
High-rise homes in the GTA also increased by seven per cent, with the average cost of a unit valued at $475,764.
In Mississauga, the average price of a home sold in June 2016 was $637,660, up 12.7 per cent from June 2015.
Brampton is also seeing a steady increase in the housing market, with the average home selling for $570,380, up from last year’s average of $460,485.
Bryan Tuckey, president and CEO of BILD, says prices have grown exponentially due to a limited supply.
“Provincial intensification policies, delays in the approvals process and a lack of serviced developable land in the GTA has reduced the amount of new homes coming to the market,” he said.
Supply of new homes has decreased 41 per cent from 10 years ago, with 17,213 new homes available in the GTA, down from 29,238.
However, sales of new homes and condominiums in 2016 were the highest they’ve been in 10 years, with 28,208 homes sold in the GTA from January to July.
Of that figure, high-rise units accounted for a record 15,852, up 36 per cent from the 10-year average.
A recent study conducted by the real estate brokerage TheRedpin found that the average household income required to buy a home in the GTA is $124,153. That amount includes other costs associated with owning a home outside the purchase price, such as property taxes and utilities.
“The industry’s biggest challenge is bringing enough new homes to market to satisfy demand,” Tuckey said. “Projects are being sold as soon as they come to market, which is driving up prices and reducing choice for new-home purchasers.”