Market Report

Toronto Real Estate Market Update – June 2020

Collingwood Real Estate Market Update – June 2020

Toronto Real Estate Market Update – May 2020

The residential resale market recovered dramatically from the lows experienced in April. In April only 2,975 properties were reported sold for the entire greater Toronto area. A typical April market would produce 9,000 plus sales. April’s decline compared to April 2019 was a shocking 67 percent.

In May the resale market demonstrated its resiliency, both as to average sale price, and recorded sales. In May 4,606 residential properties were reported sold. This represents a 55 percent improvement compared to April’s results. Although the improvement was dramatic, May’s results were 50 percent less than a typical May. Last year Toronto and area realtors reported 9,950 residential resales.

During the month of May the residential resale community adapted to the new in-person showing protocols – wearing masks, gloves, using hand sanitizers, and restricting the number of people during showings. In addition, realtors are now using various virtual viewing platforms that allow buyers to familiarize themselves with properties without viewing them in-person. Public and agent open houses were banned shortly after the implementation of the provincial emergency measures.

Notwithstanding the decline in sales, the Toronto and area average sale price has remained strong. Last May the average sale price was $838,248. This May it came in at $863,599, an increase of 3 percent. In the City of Toronto (area code 416) the average sale price was $955,273, 2 percent higher than the average sale price of $937,000 achieved in May of 2019. In the City of Toronto detached properties averaged $1,422,000, semi-detached came in at $1,143,000 (9 percent higher than last year’s prices) and condominium apartments came in at $674,000, 5 percent higher than last year. In Toronto’s central core, the average sale price for condominium apartments was $740,000.

What was a problem even prior to the implementation of the emergency measures in March, has been accentuated in April and May: namely, a lack of supply. Last year there were 20,017 properties available for buyers to inspect and purchase. This May the available supply has dwindled to only 11,448 properties, a 42 percent decline. In April there were only a little more than 10,000 available Toronto and area properties for buyers. In a healthy, balanced market there should be no fewer than 25,000 properties in inventory. The lack of supply is, of course, responsible for the strong resale prices. New listings coming to market were down by over 53 percent in May.

Not all sectors of the market place were performing equally in May. In particular the higher end of the market was sluggish. Higher end property sales are not driven by necessity to the degree that lower priced properties are, and given the collapse of the equity markets (now recovering), only a handful of the reported sales were in this category. Last May 292 properties having a sale price of $2 Million or more were reported sold. This year only 132 properties in this price point were sold, a decline of 55 percent. In April only 67 properties sold in this category.

It is interesting to examine very early numbers for June, particularly in the City of Toronto. In May, on average, 50 properties were reported sold on a daily basis. In the first 4 days of June, the number of properties reported sold on daily basis has increased to 93. If this pace continues we could see close to 3,000 reported sales in June for the City of Toronto, not dissimilar to the historic averages for June.

June’s early numbers clearly indicate that the resale market has been incrementally improving, almost on a daily basis since early April. As the emergency measures are relaxed, and more businesses are allowed to open up, resulting in people returning to work, these incremental measures in the number of sales and average sale prices are likely to increase, particularly if more inventory makes its way to the market.

Muskoka Real Estate Market Update – January – May 2020

So much change took place in Canada and in fact throughout the world in the first five months of 2020 that analyzing the Muskoka and Area marketplace over this period as if it was homogeneous would give a very distorted view of what occurred. All was well until mid-March, then the province implemented the emergency measures designed to combat the spread of Covid-19. The implementation of the emergency measures – the closure of most businesses, all bars and restaurants, the prohibition of short-term rentals, and the ban on non-essential travel – came at the time when the Muskoka and area marketplace was just beginning. All of these factors must be kept in mind while analyzing the market through this period.

Generally, waterfront sales even in the first quarter of 2020, felt the impact of the emergency measures. Throughout the region sales declined by 5 percent compared to the same period last year, from 151 to 144 reported waterfront property sales. Prices also declined but marginally, from $509,911 to $500,000, a drop of 2 percent.

April’s results were much more dramatic. By April the lockdown measures were fully in effect, not only restricting non-essential travel but making in-person showings of properties very restrictive. Open houses, both public and agent open houses, were banned.

In April 64 waterfront property sales were reported sold in the Muskoka region. This compares negatively to the 102 reported sales for the same month last year, a decline of more than 37 percent. It is not surprising that average sale prices also declined. Last April the average price for all waterfront sales was $587,500, slipping by 9 percent to $535,000 this year.

By May the waterfront overall marketplace rebounded strongly. In May 2019, 206 waterfront properties came to market. This year, 175 new waterfront listings came to market, a decline of only 16 percent. This is quite remarkable in light of the fact that the number of new listings that came to market over the same period in the greater Toronto area was almost 55 percent fewer new properties on the market compared to May last year. Sales during this period were even more remarkable. Last May 77 waterfront properties were reported sold in the region. Surprisingly, 78 properties were reported sold this year. No doubt this reflects the space and sanctuary trend that has been triggered by the Covid-19 pandemic.

Sales and listings on Muskoka’s three Big Lakes, Lakes Joseph, Rosseau and Lake Muskoka clearly reflect the impact of the emergency measures and the fact that the equity markets collapsed after mid-March (although largely recovered by the time this report was prepared). The price point on the Big Lakes is that much higher than many of the waterfront properties on smaller lakes scattered around the region, making them more sensitive to massive shocks to financial markets and the economy. The chart below vividly sets out the difference in inventory and sales to the end of May for new listings that came to market and the number of waterfront properties that were reported sold and the respective Big Lakes. Numbers for Lake of Bays and Huntsville’s four big lakes have also been included. The chart clearly indicates that by the end of May, both listings and sales on the Big Lakes had made a remarkable recovery.

Average prices on the Big Lakes have continued to rise over the period. This is no doubt due to the fact that the sales that have been recorded have been higher priced properties that have attracted buyers that have not been impacted by the emergency measures and their financial fallout. At the end of 2019 the average price for properties sold on Lakes Joseph, Rosseau and Muskoka (for all properties selling over $500,000) came in at $2,639,726. By the end May, and despite the pandemic and all the associated negative fallout, the average sale price came in at $3,074,542, an increase of 16 percent.

Notwithstanding the impact of the emergency measures, Chestnut Park continues to be the industry leader in sales. We continued to invest in technology and develop innovative methods for showing properties and for selling them. At the same time, we were, and are, committed to the local community and have developed a fund raising program to assist South Muskoka Hospital in Bracebridge. In the Port Carling area, Chestnut Park and its sales representatives were responsible for more than 87 percent higher sales volume than the nearest competitor office. On a year to date basis, we sold 24.5 percent more recreational property than over the same period in 2019 and increased our dollar volume of sales an outstanding 44 percent.

So, what does all this market data mean. The waterfront market place was stunned into stillness when the emergency measures were announced in mid-March. However, as indicated above, the waterfront marketplace does not normally begin to perform until well into April and May. While the emergency measures caused a pause in the market place, after a period of adaption to the new restrictive protocols, it has begun to perform in a fashion consistent with historical patterns. Given the trend towards space and sanctuary by buyers, it is anticipated that throughout the summer months, the market should out perform 2019. The major concern is supply: hopefully there will be enough supply to meet not only the historical demand, but the demand for rural and recreational properties created by the pandemic.

Toronto Real Estate Market Update – May 2019

Toronto Real Estate Market Update – February 2019

February results were expected to continue what we saw in the first month of 2019 — modest growth in sales and average sale prices. That didn’t materialize. I have generally not regarded the weather as having a material impact on the residential resale market, but this February may be the exception.

This February we saw a modest decline in sales compared to February last year. This year 5,025 properties were reported sold, a small decline of 2.4 percent compared to the 5,148 properties reported sold in February 2018. The reason for this decline, particularly in the 416 regions, was simply due to a lack of inventory. Since January saw a year-over-year increase in supply, the only plausible explanation is the weather. February brought three major snow storms, and effectively paralyzing the greater Toronto area on three different occasions, with snow mounting to shocking levels. It is not surprising that properties did not come to the market.

In February only 9,828 properties came to market, 6 percent less compared to the 10,473 that became available least year. Even the 10,473 properties that became available last year were insufficient to meet demand. Consequently, as we enter March, we are marginally lower than the properties available to buyers last year, and most of the properties are in the 905 regions of the greater Toronto area. Of the 13,284 properties available for sale, 70 percent of them, or 9,352, are located in the 905 regions.

It is clear that demand is present and because of supply shortages it is beginning to pent up. In February the properties that sold caused the average sale price to increase for the second month in a row. All properties sold for $780,000 in February, almost 2 percent higher then last February’s sale price of $767,000.

In the City of Toronto, the average sale price increased dramatically to $840,000 (a price which includes all condominium apartment sales), at least 10 percent more than the average sale price in the 905 regions. The clearest example of both the supply shortages and the impact on average sale prices is February’s average sale price for semi-detached property in the City of Toronto. In February the average sale price came in at a shocking $1,087,363. Semi-detached property sales only exceeded $1 Million during the frenetic increase in prices in late 2016 and the early months of 2017.

The length of time that properties spent on the market also demonstrates how strong the City of Toronto’s resale market continues to be. In February all properties available for sale in the greater Toronto marketplace sold in only 25 days. In the City of Toronto sales happened at a lightning speed of 22 days. Semi-Detached properties both in the 905 regions and the City of Toronto sold even faster – 18 and 15 days, respectively. What is astounding and further proof that supply is insufficient to meet demand, is that all semi-detached properties sold for more than their asking price. At 102 percent in the 905 regions and at 106 percent in the City of Toronto.

It is concerning that the last truly affordable housing type, condominium apartments, is rapidly becoming unaffordable. In February all condominium apartments sold in the City of Toronto (on average) for $612,000. In Toronto’s central districts, where most condominium apartment sales take place, the average sale price came dangerously close to $700,000. With the increase in mortgage interest rates and the implementation of mortgage stress testing, these prices are making it very difficult for first time buyers to enter Toronto’s real estate market.

At the other end of the real estate spectrum, higher end property sales continue to strengthen. In February 118 properties having a sale price of $2 Million or more were reported sold. This compares favorably to the 126 sold last year. It is interesting to note that condominium apartments accounted for almost 10 percent of sales in this price category.

As we move into March and improving weather conditions, we anticipate more properties coming to the market to meet demand. It would appear that buyers have accepted higher interest rates and mortgage stress testing but are frustrated by their inability to find suitable properties for sale, especially semi-detached properties in the City of Toronto.

Collingwood Real Estate Market Update – February 2019

The average sale price for the Western Region was $508,899, up 9.3% from February 2018. With inventory across the region remaining at near historic lows, combined with the ongoing population growth in the area, prices have continued to increase over the past 10 years. New listings were down 5.1%, with 188 residential properties coming to market in February 2019 vs 198 last February. Active listings were up 16.2% year over year with 496 properties available in February 2019 vs 427 in February 2018. Sales showed a significant increase of 29.1%, with 111 sales reported in February 2019 compared to 86 last February.

February 2019 reported 4.5 Months of Inventory (MOI) down from 5.0 months for February 2018. An MOI under 5 months is considered a Seller’s market, meaning less supply available, creating tighter market conditions. With the snow and ice melting away and Spring right around the corner, more Sellers will likely be ready to bring their homes to market offering patient Buyers more choices.

PEC Real Estate Market Update – February 2019

Based upon the statistics released by the Quinte & District Association of Realtors® (“the Quinte Board”), the pace of activity in the Prince Edward County (“the County”) real estate market slowed somewhat over the month of February. The potential reasons for this pause are twofold. First, the County was pounded by a series of particularly brutal storms over the last month which have made travel to and throughout the County challenging at best. Bluntly put, just about everything has been covered by a thick blanket of snow and coated by an intimidating sheet of ice, which has undoubtedly impeded the ability of potential buyers to get into and properly inspect the properties in which they may be interested. In addition to that, those actively involved in the market have been consistently frustrated by the shortage of good property stock, which has been further compounded by the limited number of new listings coming onto the market. Perhaps with the forecasted thaw, and impending spring conditions, sellers will be encouraged to put their properties on the market, and buyers will be able, and feel more inclined to venture out and see them.

Specifically, according to the Quinte Board, only 24 properties sold in the month of February across the wards that make up the County. That is over 35% fewer than sold the year previous when 37 properties were recorded as sold, and is 10 fewer than sold in January, 2019. Year to date, 58 properties have changed hands in the County, marking a 4% increase over the 56 sales logged last year by this time.

As indicated, however, the number of new listings are flat. Only 53 new properties came onto the market which is the same as the year previous when the market was already tight. Year to date new listings lag last year’s numbers by 15% with only 140 new properties being listed in total thus far in 2019 compared to 165 one year ago.

It is interesting to note that those properties that did sell in the County during the month of February, did so at a premium. The Quinte Board calculated the average sale price of properties this month at $502,953. This impressive benchmark exceeds last year’s figure ($392,059) by over $100,000 and marks a year over year increase of over 28%. As indicated in earlier reports, due to the smaller sample pool from which these figures are derived, real estate statistics for the County are subject to more volatile swings as they are inevitably more influenced by the particular cross-section of properties that sell at any particular time. Having said that, they still provide some insight into the trends and trajectory of the market, which in the case of price, has been a relentless surge upwards over the last few years. Consistent with this, the median sales price for the County came in at $512,000, which amounts to a whopping 60% year over year increase from $373,500 in February 2018.

Buyers did take longer to locate, settle on, and secure their properties of choice, as the average days on market for properties that sold in February went up from 68 to 99, which is an increase of almost 46%. This could be a factor of a number of things including: sellers being tenacious about their selling price and forcing buyers to deliberate longer before being able to confidently proceed with an offer; buyers taking longer to find exactly what they were looking for; or as stated, the particularly inclement weather confronting all players in the County real estate market in February.

And finally, while they may not necessarily reflect the properties or price points that buyers are interested in or looking for, there are in fact more properties on the market this year than last. At months end, 402 properties were listed for sale, while according to the Quinte Board, there were only 249 the year previous at that time.

The prospect of warming temperatures and the advent of spring should usher in new market conditions for the County. Hopefully, it will prompt sellers to list their properties for sale with the knowledge that the attributes of their property can be more favourably showcased, and the belief that buyers will be more inclined to venture out and appreciate them. Generally, market conditions seem to be stabilizing with a return to a more sustainable pace, but recent price trends suggest that, despite its ongoing relative competitive price advantage, the County is not immune from the affordability challenges now confronting many buyers grappling with higher debt loads, carrying costs, and the more stringent lending criteria imposed by the stress test.

Toronto Real Estate Market Update – January 2019

2019 started positively, surprising many who were anticipating the double-digit declines that the Toronto and area residential resale marketplace delivered in November and December of last year. Although moderate, January delivered increased sales volume and average sale prices compared to January 2018.

There were 4,009 sales reported in January, a less than 1 percent increase compared to 2018, but an increase nonetheless. Encouragingly, January’s positive results were due to an improvement in Toronto’s 905 region. The Greater Toronto Area was dramatically impacted by the provincial foreign buyers’ tax and has lagged behind the Toronto 416 market since the spring of 2017. In January, the 905 region’s sales were up by 2.5 percent compared to last year, while the City of Toronto’s sales declined by 3.5 percent. The decline in City of Toronto sales was not caused by a decline in demand. Rather the decline was driven by a chronic shortage of supply. At the end of January, the Greater Toronto Area had 2.7 months of inventory, whereas the City of Toronto found itself with only 1.9 months of inventory. The difference in inventory is also reflected by the fact that sales in the 905 region took place in 33 days (an average), yet it took only 29 days for all properties in the City of Toronto to sell.

Another positive aspect of January’s performance is the supply of new properties that came to market. In January, 9,456 new properties became available to buyers. This is a favourable 10.5 percent increase compared to the 8,561 new listings that became available last year. Entering February, active listings were slightly higher than last year. February began with 11,962 active listings compared to the 11,894 available last year. The bulk of these listings are located in the 905 region. OF the 11,962 active listings, 8,387, or more than 70 percent, are located in the 905 region.

January’s average sale price came in at $748,328, an increase of almost 2 percent compared to last year’s average sale price of $735,874. This is exactly the kind of increase that reflects a stable and sound market, not the double-digit monthly increases that became commonplace in 2016 and early 2017. Double-digit increases in average sale prices become unsustainable and unfortunately can lead to painful corrections.

In this regard, Toronto’s high-end residential market continues to adjust. In January, 76 properties having a sale price of $2 million or more were reported sold. This compared to 90 reported sold during the same period last year. The adjustment is also evident in the sale price to listing ratio witnessed in January. Detached properties in Toronto’s central districts are the most expensive properties in the Greater Toronto Area. All detached properties in these districts sold for 95 percent of their asking price. This ratio was much lower than the detached properties in other trading districts. For example, all detached properties in Toronto’s eastern districts sold for 100 percent of their asking price. The fact that the average sale price in the eastern districts is half ($916,588) that of the central districts ($1,938,617) is no doubt responsible for this divergence. Higher-end properties accelerated more dramatically during the pre-2017 introduction of the Ontario Fair Housing Plan and are retracting proportionally, especially with the introduction of the 15 percent foreign buyers’ tax.

Condominium apartments continue to be the most affordable housing form, but again, because of supply, average prices continue to increase. In January, the average sale price in the City of Toronto increased by almost 9 percent to $591,444. In Toronto’s central districts, where most condominium apartment sales are located, the average sale price came in at $677,997, a 10 percent increase compared to last year’s prices. In January, there were only 1,738 condominium apartments for sale in the City of Toronto and only 1,093 in Toronto’s central districts where most sales take place. This shortage of supply will continue to put upward pressure on prices, constrained only by affordability.

Although it is a little early in the year to be forecasting for 2019, January’s results – sales volumes, price increases and increases in supply – all point to a healthy 2019. Last year only 77,375 residential properties were reported sold, the lowest number since the recession of 2008. Barring any unexpected economic events this year, we should see between 83,000 and 85,000 reported sales, with average sale prices increasing by about 2-3 percent. January’s average sale price came in at $748,328. Last year’s annual average sale price was $787,000. By year-end, Toronto and area’s average sale price should be approximately $800,000. From a long-term sustainability prospect, we should be thrilled with this number.

Collingwood Real Estate Market Update – January 2019

January 2019 market conditions in the Western Region of Southern Georgian Bay reflected the more moderate and balanced pace experienced throughout the last portion of 2018 compared to what Buyers and Sellers had experienced over the past few years. Looking back, the Fair Housing Plan was introduced by the Ontario government in April of 2017 to quiet the market frenzy that began in 2016. New mortgage rules were introduced in 2018 that required all Canadian home buyers to undergo a mortgage stress test, even with a down payment of 20% or more. These measures were intended to cool overheated markets and curb risky lending. Many Buyers have been faced with difficulties qualifying for loans under the stress test that ensures Buyers could still afford their mortgage if interest rates were two percentage points higher than the rate they negotiated with their bank.

It’s not surprising that with interest rate hikes implemented in 2018 along with government measures and ongoing supply issues that the number of sales in the Western Region of Southern Georgian Bay in January 2019 were down 16.5% from one year ago.

With the ongoing scarcity of listings and continued demand driving prices upward, the average sale price in the Western Region reported a 29.7% increase from last January, reflecting similar activity reported across the region where the average sale price was up in all areas except Meaford, which reported a modest decline of 3.3%.

New listings were up 13% year over year and even though active listings were up 29.8% to 471 in January 2019, inventory remained at near historic lows.

The Sales-to-New-Listings Ratio indicates the ratio between the number of homes sold and the number of new listings entering the market. With the Sales-to-New-Listings Ratio down from 60.9% last January to 45%, the Western Region is clearly heading out of a long-running Seller’s market into a balanced market. A higher ratio implies a Seller’s market, while a lower ratio implies a Buyer’s market.

With interest rates unlikely to climb significantly in 2019, affordable housing options and strong demand for the vibrant lifestyle offered in the area, the Western Region is poised to perform well throughout the coming year.