Market Insight for May 30

New construction home sales in the Greater Toronto Area (GTA) have now recorded their seventh straight month at historically low levels, surpassing even the slump seen during the 1990s housing downturn.

Back in the 1990s crash — which spanned from around 1989 to 1996 — the market hit a low point with six months of record low sales. However, even then, the number of homes sold was roughly twice what it is now, according to a report released Wednesday by the Building Industry and Land Development Association (BILD). The group is urging the federal government to extend its GST relief program to cover all new home buyers.

Last month, there were only 310 new home transactions, representing a 71% drop compared to April 2024 and sitting 88% below the average for the past decade, according to data from Altus Group, BILD’s analytics partner.

Out of the total sales in April, 105 were condominium units and 205 were single-family dwellings. Typically, new home sales in April in the GTA average about 2,750 units over the previous ten years.

Buyers are looking for stability, but ongoing uncertainty — including the potential impact of tariffs — is undermining consumer confidence and discouraging prospective purchasers from moving forward.

This week, the federal government introduced proposed GST (HST) relief measures targeted at first-time buyers of new homes.

The new initiative aims to remove GST on newly built homes priced up to $1 million for first-time buyers, and to partially reduce the tax for homes priced between $1 million and $1.5 million. These changes could result in savings of up to $50,000 for eligible buyers.

However, BILD spokesperson Justin Sherwood argues the policy doesn’t go far enough. “Limiting this measure to first-time buyers will have a limited effect, since they represent a small portion of new home purchasers,” Sherwood said. “It won’t meaningfully improve affordability or significantly boost construction and sales activity.”

BILD maintains that the most effective approach would be to make the GST (HST) relief applicable to all new home purchases, not just first-time buyers.

Condominiums saw the steepest decline, with only 105 units sold in April — an 80% decrease compared to April 2024, and 94% below the 10-year average. These figures include units in low, medium and high-rise developments.