Fri., July 22, 2016
The cost of a new low-rise home in the Toronto region has more than doubled in the last decade to $887,543 in June, up from $393,398 in 2006 — a trend that is being fed by a record low supply within the same period.
A report on housing trends over the last decade from the Building Industry and Land Development Association (BILD) shows that the price on new low-rise homes, including detached, semi-detached and townhouses, has risen more than $100,000 in the last year alone.
The building and renovation industry has been raising concerns about the provincial land use policies since they were introduced in 2006.
But with Queen’s Park expected to launch new higher intensification targets in the fall, BILD wants the province to look at the potential impacts.
“We’re just starting to feel the effects of their existing policies in terms of price and supply. We’re encouraging them to take a hard look at the numbers and to understand the effects of their current policies before they increase numbers,” said Michelle Noble, vice-president of marketing and communications.
Consumers also need to be part of the discussion because millennials still want to buy detached homes, she said.
“It’s really important for people to enter in on this conversation about what do they want their housing choices to be. We see they change as your life changes and you age but we’re being forced to build housing supply that doesn’t always take that into account,” said Noble.
Despite the region’s growing population, the inventory of new homes has actually dropped in the last 10 years by about 11,500 units.
BILD statistics released Friday showed that the cost of a high rise condo has also risen by 6 per cent in the last year alone.
Noble said the industry has been very responsive in adapting to Ontario’s new denser land use policies, creating products like stacked townhomes and innovative condo layouts.
“We’re following policy and every year we build fewer and fewer low-rise homes, especially detached homes, so all that exist become more valuable,” she said.
That has led to tough competition at sales centres with consumers lining up to buy and some developments selling out within hours or release.
But environmentalists, who support higher density targets for the Greater Golden Horseshoe, say there is enough land to provide housing development at existing rates through 2031.
“There’s no evidence to show there’s a lack of land for building new homes, either the low-density stuff that BILD likes or high density stuff that would be better,” said Tim Gray of Environmental Defence.
Proximity to urban amenities, not land supply, is driving prices, he said. “The real issue is what kind of housing future are we going to have. Are we going to have more diverse housing styles that actually meet the needs of our population? Are we going to grow our population in a way that means it’s dense enough for transit; that we leave our farmland in a state that we can continue to grow food; that we have walkability and higher quality of life?”
By the numbers
18,427: Inventory of new homes in the GTA in June 2016, including 2,064 low-rise units — townhomes, semis and detached houses
29,968: New home inventory in June 2006, including 16,363 low-rise homes
4,166: New homes sold in the GTA in June — 22 per cent fewer than last June
31%: Decline in number of new low-rise home sales in June year over year
14%: Reduction in the number of new condo sales in June over last year
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