Sales of new construction homes rose significantly in June compared to the same month last year, while home prices remained flat year over year, with the market and industry continuing to adjust to the mortgage stress test that pushed some consumers out of the market since its introduction in January 2018.

The benchmark price of a new single-family home — a category that includes detached, semi-detached and town houses — declined 3 per cent year over year in June to $1.1 million.

Condo prices showed a 4 per cent gain in the same period with the benchmark price rising to $804,591. That reflects the launch of some higher-priced developments in June, according to Patricia Arsenault, vice-president of Altus Group, the company that tracks the home building industry.

“We are seeing a market that has some stability. We are getting back to a more balanced market. We are seeing inventory levels come up as a whole,” said David Wilkes, CEO of the Building Industry and Land Development Association (BILD) on Thursday.

The 17,127 new homes sold across all housing categories in the first six months of this year was 43 per cent above last year’s decade low for the same period. Single-family home sales were up 130 per cent compared to last year and condo sales rose 24 per cent. That remains 40 per cent below the 10-year average for single-family units and 5 per cent above for condos.

For the month of June, single-family home sales rose 127 per cent to 932 year over year and condo sales increased 14 per cent with 2,420 transactions last month. That is about 30 per cent below the 10-year average for single-family home sales and 5 per cent below the decade average for condos.

Share your thoughts:

Wilkes said the industry is encouraged by the provincial government’s Bill 108, which is supposed to streamline construction approvals, and City of Toronto plans to expand housing options, including “missing middle” type homes such as stacked townhomes that provide consumers with an alternative to high rises and expensive detached houses.

“Based on conversations with the industry we are seeing a different policy regime that is allowing additional missing middle,” he said, citing the city’s laneway housing policy to encourage new units that face Toronto’s alleys and some new mid-rise buildings.

“Overall, demand is not going away,” said Wilkes, but inevitably there is a lag between policy developments and construction.

“As the market continues to demand it the industry will respond,” he said.