February 2017 was certainly one for the books. We saw tremendous year over year price increases right across all property types in Central Toronto. There has been wide speculation about what is causing this huge increase in price, foreign buyers being the easy target. In our view one of the greatest culprits is simple supply and demand. Demand is incredibly strong while supply is low and has been low (from a year over year comparison stand point) for months, since December. In February 2017 there were 12.5% fewer new homes hitting the market as compared to February 2016. Low inventory has resulted in a backlog of buyers building up so then when inventory does come onto the market there are just that many more people bidding to get the property pushing prices up and up. The first chart outlines the historic number of new listings hitting the market so you can see this low inventory trend.