Average home prices in Toronto have increased to over $500,000 for the first time in history. Greater Toronto Realtors® reported that the average sale prices for Toronto homes in the month of February, 2012 was $502,508, compared to $453,329 in February, 2011 – an increase of almost 11% year over year. Not surprising, but home sales and new listings were also up. There were a total of 7,032 home sales in February, 2012 compared to 6,058 in Februrary, 2011 – an increase of more than 16%. New listings also increased more than 11%, from 11,404 in February 2011 up to 12,684 in February 2012.

Competition between buyers is probably the strongest contributing factor to the increase in selling price. With low interest rates and low inventory in high demand areas, buyers continue to exert upward pressure on the selling price of homes in Toronto. Bidding wars are evident in almost every home buyer scenario as homes sold for an average of 99% of the asking price. The Bank of Canada has said that they will hold interest rates at around 3% for the remainder of 2012. If this holds true and inventory does not increase, then we can expect to see similar market conditions for the remainder of the year.

Here’s a look at the numbers from February 2012 when compared to February 2011. Home sellers in Toronto are in an ideal situation, as long as they don’t need to purchase a home after they sell.

February 2012 vs. February 2011:

Toronto Home Sales:
- February 2012: 7,032
- February 2011: 6,058

New Listings In Toronto:
- February 2012: 12,684
- February 2011: 11,404

Toronto Average Sale Price:
- February 2012: $502,508
- February 2011: $453,329

Days On Market:
- February 2012: 24
- February 2011: 27