BILD President and CEO Bryan Tuckey attributes the slowdown to tighter lending rules that have shut the homeownership door on first-time buyers.
"In an attempt to cool down the market, the federal government has severely affected the building and development industry in the GTA," he said.
This industry created 193,300 jobs and paid out $10.1 billion in wages last year in the GTA alone, making it a key player in the economic development of Ontario. Tuckey worries this will be affected if the current buying mood continues.
"The introduction of stricter mortgage regulations has triggered a decline in new home sales, and if this trend continues, it will affect job creation in the coming years, restricting economic growth."
Three consecutive low sales months has contributed to 29,322 new home sales across the GTA this year, slipping 14 per cent below the long-time average. According to RealNet Canada Inc., just 2,792 homes were sold in October 2012, making it the second-lowest October on record.
Tuckey also points to higher home prices as a contributing factor of the drop in sales.
The RealNet New Home Price Index listed the price for a low-rise home in the GTA in October at $616,623, up 16 per cent year over year. High-rise homes also saw a slight increase of 2 per cent, bringing the list price to $439,328. This sector had 1,914 sales this month, making it the fifth-highest October for the high-rise market on record.
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