Sales of high-end houses helped to keep the average price of a detached Toronto house at well over $1 million in June, the Toronto Real Estate Board says.
In the Greater Toronto Area (GTA), the average selling price for all homes last month was $639,184. That's up 12.3 per cent from the same month a year ago, the board said Tuesday.
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The real estate board said the most expensive homes are driving that double-digit increase in average prices.
Using another method of home price calculation — the MLS Home Price Index composite benchmark — the typical selling price was up by 8.9 per cent. The MLS Home Price Index attempts to get a clearer picture of price trends by measuring the rate at which housing prices change over time by tracking price changes in "typical" homes in each market.
But no matter which method is used, there is precious little indication that the Toronto real estate market is cooling.
Sales of houses, townhomes and condos in the GTA reached 11,992 in June, up more than 18 per cent from 10,132 in June 2014 — a record for the month.
In Toronto, the average selling price of a detached house last month hit $1,051,912, an increase of 14.2 per cent over last year.
The average condo price in Toronto rose seven per cent from the previous year to $418,599. Condo construction has been booming in the city, leading some analysts to muse in recent years about oversupply and eventual price corrections.
The annual rate of sales growth in the Toronto area is outpacing the rate of listings growth by a wide margin, according to the real estate board.
"As long as this situation persists, expect home prices to trend strongly upward," said Jason Mercer, the board's director of market analysis, in a release.
House prices in Toronto and Vancouver have been rising far faster than inflation in the last few years. The Real Estate Board of Greater Vancouver last week reported the hottest June on record, with a detached home in Greater Vancouver now going for $1,123,900, up 14.8 per cent in the past year. But the housing market in the rest of Canada has been much more subdued.
Next week, the Bank of Canada will decide whether to leave its trendsetting key interest rate as is (at 0.75 per cent), or change it. Financial markets are putting the odds of a quarter of a percentage point rate cut coming out of that meeting at 50 per cent.
But a rate cut poses a potential problem for the central bank, which already considers the Canadian housing market to be a financial stability risk. While the Bank of Canada wants to boost the country's sluggish growth, cheaper money could lead to an even more frenzied housing market in two of the country's biggest cities.