Toronto Real Estate Market Update – November 2020

The Toronto and area residential resale market continued its torrid pace in November, defying all expectations and forecasts. It wasn’t, however, homogenous in its performance, with different housing types and areas performing at dramatically different levels.

Overall, reported sales for the greater Toronto area were up a scorching 24.3 percent compared to November 2019. Last year, 7,054 residential properties were reported sold. This year that number jumped to 8,761. That number was driven primarily by the sale of ground-level properties, detached, semi-detached, and townhouse homes. Sales of these types of homes increased in both the City of Toronto and the 905 region, and correspondingly, so did average sale prices.

In November, the average sale price for all properties sold across the greater Toronto area came in at $955,615. This number was more than 13 percent higher than the $843,307 achieved in November of 2019. In the City of Toronto, the average sale price was even higher, coming in at $979,224. These numbers would have been even higher if not for the lagging performance of condominium apartment sales in the City of Toronto.

Once again, as in previous months, resale data indicates that market activity has shifted from the City of Toronto to the 905 region. The 905 region includes Halton, Peel, York, Durham, Dufferin, and Simcoe Counties. Of the 8,761 reported sales for the greater Toronto region, 5,729, or 65 percent, were in the 905 region. What we also witnessed in November was the average sales price gap between the City of Toronto and the 905 region is narrowing. For the third straight month, average sale price gains in the 905 region far outdistanced gains in the City of Toronto. The average price increase for all property types in the City of Toronto was 5.5 percent. In the 905 region the average sale price jumped by 14 percent. Even if condominium apartment sales were extracted from these numbers, gains in the 905 were at least double the average sale price gains in the City of Toronto.

Except for condominium apartment sales in the City of Toronto the entire resale marketplace continued to move at a torrid pace. In November, all sales across the greater Toronto area sold (on average) in only 19 days, 26 percent faster than the 24 days it took last year. The pace for semi-detached properties in the City of Toronto was even more hectic. All semi-detached properties sold in only 14 days. Toronto’s eastern districts, which include the popular Riverdale, Leslieville, and Beaches trading areas, saw semi-detached properties sold in only 11 days, and (on average) for 109 percent of their asking price. The average sale price for the combined eastern districts for semi-detached properties exceeded $1 million, with substantially higher average sale prices in the most popular neighbourhoods. Similar results were achieved in Toronto’s western districts. Because of higher price points, Toronto’s central district sales were a little slower (20 days) but still managed to achieve sales prices that were 102 percent of the asking price.

It should be noted that the high end of the market also put on a strong performance. Throughout the greater Toronto area, 356 properties with an average sale price of $2 million or more were reported sold in November. This compares with only 199 sold in the same category last year. On a year-to-date basis, 3,363 $2 million plus properties have been reported sold. Last year, at the end of November, 2,171 properties at this price point were reported sold. This year’s sales represent a 55 percent increase in high-end property sales compared to 2019.

If there is a dark spot in the greater Toronto resale marketplace it’s condominium apartment sales in the City of Toronto. In November, sales were flat, and average sale prices fell off by 3 percent. Unfortunately, that’s not the whole story. Inventory levels are increasing dramatically. In November, 2,943 new condominium apartments came to market (some of these were no doubt new listings of units that hadn’t sold and were being re-introduced to the market, often at lower asking prices). Last year, only 1,629 new listings came to market. November’s new listings increased the total number of active listings to 5,018, 194 percent higher than the 1,707 condominium apartments available to buyers at the same time last year.

On a more positive note, by the end of November, year-to-date, 88,026 properties (all types) were reported sold for the greater Toronto area. Total sales for 2019 were only 87,753. Notwithstanding the pandemic, and its negative impact on our society, our businesses, and our health and safety, with December still to be counted, 2020 will be the Toronto and area’s best year for resale house sales since 2016. Astonishing.

Toronto Real Estate Market Update – October 2020

It was no surprise that October’s resale market results continued the record pace that began in June. Reported sales hit a new high in October, with 10,563 residential properties trading hands during the month, a 25 percent increase compared to last year.  Not only were sales volume at record levels, but average sale prices also continued their steady upward march. Last October, which was a strong month, 8,445 properties were reported.

This October there was also a sharp rise in the average sale price. Last October the average price for all properties sold was $851,877. This year the average sale price increased by almost 14 percent to $968,318. Depending on the location the average sale price was even higher. In the City of Toronto, the average sale price came in at $1,025,925. This number is startling when it is remembered that it includes 1,438 condominium apartment sales or 40 percent of the 3,514 properties that sold in the City.

The Toronto and area residential market is now all about fragmentation, a phenomenon driven by the pandemic and the psychological and physical impact that it has had on the residential market, both locally and throughout North America. People’s desire for more space, coupled with technological advances that allow people to work remotely, have untethered buyers from dense, crowded urban regions, allowing them to move to new marketplaces. That movement is clearly reflected in the October data.

There were 3,514 properties reported sold in the City of Toronto, (including condominium apartments). That represented a 6.6 percent increase compared to the 3,295 that sold last year. In the 905 region of greater Toronto, 7,049 were sold in October. Last year only 5,196 properties were reported sold in the same month. The year-over-year increase in the number of sales in the 905, namely 36 percent, dwarfs the increase in sales in the City of Toronto. Clearly, buyers were active in Toronto’s 905 region. No doubt a large part of those buyers were former City of Toronto condominium apartment dwellers looking for ground-level properties.

The exodus to the suburbs and the 905 region is no more evident than the impact it has had on both the condominium apartment and rental markets. In October, 1,438 condominium apartments were reported sold in the City of Toronto. Last year 1,575 were sold. This decline of 8.5 percent is one of the first declines we have witnessed in more than 10 years. Condominium apartments have been Toronto’s only affordable alternative. Detached and semi-detached properties, given their stratospheric increases in average sale prices, have been beyond the financial reach of most buyers, especially first-time buyers.

Declining sales usually mean declining average sale prices, unless the decline in sales is due to a decline in inventory. Unfortunately, condominium apartment supply has skyrocketed. In October, 4,494 new listings came to market, bringing the total available inventory at month end to 5,719 condominium apartments. By comparison last October only 2,213 new listings came to market, 50 percent fewer than this year. At the end of October last year there were only 2,098 condominium apartments available for sale, 63 percent fewer than this year. It is not surprising therefore that the average sale price for condominium apartments, namely $668,161, was almost 1 percent less than a year ago. Rentals of condominium apartments are suffering the same fate, with rising inventories and declining monthly rental rates.

Detached and semi-detached property sales were robust in October, increasing by 20 and 30 percent respectively as compared to last year. The average sale price for detached properties increased by more than 11 percent and semi-detached by only 5 percent, to $1,470,857, and $1,154,087 respectively in the City of Toronto.

It should be noted that the high-end of the market has been performing exceptionally well. Across the greater Toronto area, 488 properties having a sale price of $2 Million or more were reported sold in October. In 2019, only 254 were reported sold in this category, a year-over-year increase of 92 percent. The majority of these sales were ground level properties, with only 20 condominium apartments falling into this category.

As we move towards the end of 2020, without any anticipated change to the economic and psychological conditions that have given rise to the exceptional, though fragmented market that we have experienced for the last five months, all expectations are that it will continue, particularly if interest rates stay at their historically low rates, and if governments keep the pandemic damaged economy liquid. The fragmentation will continue to see strong demand in the 905 region and in the secondary markets surrounding the greater Toronto area. We can expect condominium apartment sales and price pattern so clear in October to continue: both sales and average sale prices will continue to decline while inventory levels will approach historic highs. 

Collingwood Real Estate Market Update – October 2020

The Western Region of Southern Georgian Bay once again set record highs for the number of sales in the region.

The unrelenting pace and demand for housing generated a substantial 65.2 % increase over October 2019 with an impressive 309 sales reported vs 187 sales for the same period last year. Only 263 new listings came to market in October 2020 compared to 320 last October. This represented a 17.8 % decrease year over year and clearly illustrated the ongoing supply crunch the region has been experiencing. The result of sales increasing and fewer new listings coming to market drove active listings down 57.3 %, from 675 at month’s end in October 2019 to a meagre 288 in October 2020.

Months of Inventory was at a low of 0.9 months, further evidence of the historically low supply and very tight market conditions. Given the insufficient number of properties for sale vs the ongoing, frenzied demand, along with the appetite for many people with big budgets to purchase higher priced homes, it was no surprise that the average sale price in the Western Region reached a record high of $739,990 in October 2020, boasting a 29.4 % increase over last year’s already lofty average sale price. This trend of extraordinarily high sale prices combined with the persistent strong demand propelled the dollar volume for October up 113.9 % over last year. The Sales to New Listings Ratio doubled from a balanced market of 58.4 in October 2019 to 117.5, a true testimony that the red hot Seller’s market the Region has been experiencing this year was still at play. Buyers on the other hand were feeling the pressure, with the median days on market reported at 18 days.

Buyers were often forced to make quick decisions and submit unconditional offers while competing in multiple offer situations. With the pandemic creating such unprecedented conditions this year, the question that remains on everyone’s mind is how much sizzle is left in this market. There are forces currently at play such as low interest rates creating opportunity and desire for many to purchase in the Western Region of Southern Georgian Bay, counterbalanced by anxiety of what stricter measures to curb the spread of the coronavirus may bring. We will have to wait and see how people react in these precarious times.

Prince Edward County Real Estate Market Update – October 2020

Despite the fact that we are entering the darker colder days of fall, and the fact that October has seen some cooler than normal days, neither were reflected in the pace and activity of the real estate market in Prince Edward County (“the County”). Rather, according to statistics made available by the Quinte & District Association of REALTORS® (“the Quinte Board”), October’s market performance is further confirmation of shifting priorities favouring communities like the County which offer more space, a sense of peace and refuge, fresh air, open spaces, and generally better and healthier lifestyle at more affordable prices. As stated in earlier reports, this evolving hierarchy of choices is made ever more available by the increased use of, and reliance on technology in the workplace, giving buyers the flexibility to invest in property where they really want to live and spend their time.

Even after the remarkable performance of the County real estate market over the last few months, October’s numbers continue to astound. To start with, sales in the County more than doubled year over. Specifically, 51 properties changed hands in October 2019, but that number ballooned to 103 this last month, amounting to an almost 102% increase. Year to date sales have swollen to 752 compared to 489 at this time last year, an increase of 54% year over year.

While according to the Quinte Board new listings increased almost 11%, that does not even come close to keeping up with demand and the pace of sales. 114 properties did come onto the market compared with 103 one year ago, bringing the year to date total to 1101, which unfortunately trails last year’s figures, if only by 1% , but the impact on supply is real. At month’s end only 290 properties were listed by the Quinte Board as being available for sale compared to 592 one year ago. In other words, the County has less than half the property inventory this year than it did last at this time.

In addition, those properties that sold, did so at a faster pace taking on average 81 days to sell compared to 87 days one year ago. A more meaningful statistic is median days on market which takes the significance of outlier sales out of the equation and measures the midpoint of duration on the market prior to selling. That number came in at 21 days. And compared to last year’s figures in October, namely median days on market of 48, properties are selling over 56% faster than they did one year ago.

Needless to say, and coming as no surprise, when demand so far outstrips supply, as it seems to be in the County real estate market, significant pressure is applied to prices. According to the Quinte Board, the average sale price of the properties that sold in the County in October came in at $584,887, creeping ever closer to $600,000 as an average sale price. The reported number constitutes an increase of almost 27% over last year’s posted average sale price in October of $461,333. The median or midpoint sales price also reflected a hefty increase, calculated at $500,000 compared to $420,000, an increase of over 19% year over year.

Despite the fact that Ontario appears to be experiencing a second wave of the corona virus, and the full brunt of the collateral economic damage caused by the pandemic has yet to be fully determined and factored into economic modelling or forecasts, the fundamental underpinnings of the County real estate market continue to look very strong and positive. Even if some early weakness in urban condominium markets may be detected, and some calming of the generally frenzied real estate markets experienced over the summer across Ontario may be discernable, there is no indication that the factors contributing to the surge in demand and growth in interest in County real estate is either temporary or will diminish any time soon. All in all, indicators point to the conclusion that the quantum shift in this real estate market is here to stay.

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.