Toronto Real Estate Market Update – March 2016

We are running out of superlatives in describing the Toronto and area residential resale market place. Literally it is going to places where no market has gone before. Average sale prices, days on market, inventory and demand have reached levels that are unique and perhaps a little unnerving.

In March the average sale price for all properties sold in the greater Toronto area came in at $688,181, marching ahead of the previous monthly record of $685,809, achieved only in February. Last March the average sale price was $613,815. This means that year over year house prices in Toronto have increased by more than 12 percent.

In the city of Toronto (416 districts) prices of detached and semi-detached properties have risen even more dramatically. The average price for a detached home in Toronto now sits at $1,174,358. In central Toronto the average sale price for a detached home came in at an eye-popping $1,863,704. What is even more startling is that all sales of detached homes in central Toronto took place in only 14 days (on average) and at 104 percent of their asking price. The numbers were lower in Toronto’s west ($938,678) and east ($808,988) trading areas, but these properties also sold at lighting speed, and for substantially more than their asking price.

7 Salisbury Ave, Toronto | $1,100,000

The story was the same for semi-detached homes. The average price for a semi-detached home in Toronto is now $817,611. In Toronto’s central districts for the first time you now have to pay over $1 Million for a semi-detached house – if you can find one to buy. All semi-detached properties in Toronto’s central district sold in an unbelievable 11 days and at 107 percent of their asking price. Some trading areas in Toronto’s central market reported no sales in March. The reason was simply no semi-detached properties were available for sale at the end of March. A stunningly low level of inventory. It is not surprising therefore that the Toronto and area high end market has also reached astronomical levels. In March 228 properties were reported sold having a sale price of $2 Million or more. This compares to only 132 properties sold in the same category last year, an increase of more than 72 percent. The 228 sales in this category were primarily detached homes, with 3 condominium apartments also sold in this price point.

124 Park Rd, Toronto | $17,700,000

Overall the market produced 10,326 sales, an increase of 16.2 percent compared to the 8,887 sales achieved in March 2015. Clearly sales were not a problem. What was, and is a problem, is the small number of listed properties available for buyers to purchase.

In March only 14,864 new properties came to market. This was almost 4 percent less than the 15,435 that came to market in 2015. By the end of March the level of available inventory was woefully low. In the entire greater Toronto area there were only 12,132 properties available for sale, more than 20 percent less than last year at this time. This represents only 1.7 months of inventory. In various trading areas and depending on housing type, inventory levels are even lower. For example, inventory levels for the combined eastern trading districts are only 1.3 months, with one district having less than 1 month of inventory, also a market first. With these historically low inventory levels it is not surprising that properties are “flying off the shelves”. In March the average days on market for all properties sold was only 16 days. In 2015, which was a record year for the Toronto market place for volume of properties sold, days on market was 20 days.
The only area of the market operating differently is the condominium apartment sector, but even activity in this market sector has also sharply increased. The average price for condominium apartments came in at $416,251. In Toronto’s central districts, which have the highest concentration of condominium apartments, the price came in at $484,000. In March the average price for condominium apartments rose by 4.3 percent. Volume, on the other hand, rose by more than 20 percent. Average days on market dropped to 25, well below where it was only a few months ago, however average sale prices rarely exceed the asking price, but like detached and semi-detached sales we are beginning to see it happen.

170 Avenue Rd, 703, Toronto | $418,800

One wonders if this market can continue at this pace. The same concern was expressed about the Vancouver resale market, but it has surpassed the wildest expectations of real estate pundits. These same pundits are now clamouring for constraint, even suggesting legislatives intervention to slow that market. In Toronto we have not reached those levels, but what was only recently thought to be implausible is happening. Stay tuned for April’s market report.

Toronto Real Estate Market Update – February 2016

January’s exceptional start paled in comparison to February’s results. February set a new high water mark for sale prices in Toronto. This speaks to the power of the Toronto resale market. In the past when records for average sale prices have been set its usually in the months of April and May, the months that are most active. This year it occurred in February.

In February the Toronto and area resale market reported an average sale price of $685,278, the highest ever recorded. The previous record was achieved in May of last year, with an average sale price of $649,648. The average sale price in the City of Toronto (the 416 districts) came in at $719,843. This average sale price is particularly startling in that it includes condominium apartment sales, which form the bulk of the sales in the City of Toronto. The average sale price achieved in February exceeded last February’s average sale price of $596,320 by almost 15 percent.

It is not surprising that the number of sales achieved in February was also a record. There were 7,621 sales reported, the highest number of sales ever produced by Toronto area realtors in any February. Last year there were only 6,294, an increase of more than 21 percent. This is an unprecedented increase for the month of February. The increase in sales was across all housing types.

In the City of Toronto detached property sales increased by almost 12 percent. Semi-detached property sales increased by almost 22 percent. But the biggest increase in sales was in condominium apartments. In February condominium apartment sales increased by more than 25 percent compared to February 2015. Given the steep increase in prices in Toronto, condominium apartments are the last resort for many buyers, especially first time buyers.

Prices for detached and semi-detached properties have increased dramatically in the last few months, once again breaking records in February. The price of the average detached house in Toronto is now $1,211,459. The price for semi-detached properties is not far behind at $848,835. Condominium apartments look very attractive at only $435,579. In Toronto’s central districts, where many of the city’s condominium apartments are located, the average sale price is $488,518.

In February all sales took place in only 21 days (on average), and much faster in some of Toronto’s trading districts and for detached and semi-detached properties. If you were fast enough to find one and offer on it, in most cases buyers found themselves in competition. Last year, which was a record breaking year for sales, it took 23 days for all properties to be marketed and sold.

Of special note are Toronto’s luxury sales. These are properties that had a sale price of $2 Million or more. In February 187 properties in this category were reported sold. This represents an incredible 82 percent increase compared to the 103 $2 Million plus properties sold in February 2015. Most of these sales were detached properties, however there were 5 condominium apartments that were sold in this category.

The focus as we head into March is Toronto’s inventory of properties available for sale. At the beginning of March there were only 10,902 active listings in the entire greater Toronto area. This compares with 12,793 in 2015, a decline of almost 15 percent. In the City of Toronto there were only 5,070 available properties, including 3,432 condominium apartments. In the greater Toronto area there are only 1.7 months of inventory. In January there were 1.8 months of inventory.

February’s inventory levels are the lowest that have been seen since the Toronto Real Estate Board began providing months of inventory data. We are a long way from a balanced market. That would require 3 to 4 months of inventory.

Looking forward we should expect more of what we experienced in February. It is unlikely that inventory levels will improve. Coupled with today’s historically low mortgage interest rates, there will be a mad scramble for properties becoming available for sale, which in turn will cause Toronto’s already high average sale prices to break new records.

Collingwood Real Estate Market Update – February 2016

This report summarizes the monthly statistics for the Western Region of the Southern Georgian Bay Association of REALTORS® (SGBAR). While the SGBAR trading area also includes the Eastern Region of Southern Georgian Bay due to an amalgamation of the Midland Real Estate Board and the Georgian Triangle Real Estate Board in 2014, this report is restricted to the Western Region, formerly known as the Georgian Triangle Association of REALTORS®.

This report summarizes the monthly statistics for the Western Region of the Southern Georgian Bay Association of REALTORS® (SGBAR). While the SGBAR trading area also includes the Eastern Region of Southern Georgian Bay due to an amalgamation of the Midland Real Estate Board and the Georgian Triangle Real Estate Board in 2014, this report is restricted to the Western Region, formerly known as the Georgian Triangle Association of REALTORS®.

As reported in previous months, listing inventory continues to decline. Examining listings for the month of February 2016, there were 275 new listings vs 317 in February 2015, which represents a decline of 13%. Year to date comparisons show February 2016 with 523 listings vs 616 listings for February 2015, marking a decrease of 15%. February 2014 had 377 listings come on the market with 812 listings YTD.

469501 31 GREY RD, GREY HIGHLANDS | $899,000

This trend has created a very strong seller’s market in certain neighborhoods such as downtown Collingwood and family neighborhoods in the Collingwood area resulting in multiple offers in certain price categories and in specific locations. Buyers must be ready to jump on properties as they hit the market. Having pre-approved financing and a good understanding of property values will be beneficial in successfully purchasing a property in current market conditions.

182 sales were reported in February 2016 which is a remarkable 44% increase over the 126 sales reported in February 2015. Even with the continued shortage of listings, sales are up for the third consecutive February, with February 2014 recording 113 sales. The YTD sales follow the same trend showing an increase of sales over the past three years. There has been a 26% increase in the sales YTD with 229 sales in 2015 vs 288 sales reported in February 2016.

152 JOZO WEIDER BLVD, THE BLUE MOUNTAINS | $380,000

When comparing February 2016 to February 2015, there is an increase in the number of sales in all price ranges between $150,000 and $700,000. Sales in the $300,000 to $349,999 price category have shown the most activity with a dramatic jump from 11 sales in February 2015 to 34 sales in February 2015.

There have been 4 sales in the $900,000 to 999,999 price range vs 1 sale in February 2015. Sales in the $1,000,000 to $1,499,999 have increased from 3 in February 2015 to 6 in February 2016. The spike in sales from $900,000 to $999,999 may be in part due to the new Canada Mortgage and Housing Corporation (CMHC) rules for high ratio mortgages which changed February 15, 2016, even though most analysts believe the measure will have a minimal impact on house sales and prices.

504615 GREY ROAD 1 , GEORGIAN BLUFFS | $599,000

The new rule now requires a 10 per cent down payment on the portion of any mortgage it insures over $500,000. Prior to February 15th, 2016 homebuyers were required to put down a minimum of five per cent to qualify for insurance, protection that lenders insist on when providing a mortgage worth more than 80 per cent of the home’s value. The five per cent rule remains the same for the portion up to $500,000. Homes priced at more than $1 Million require a minimum down payment of 20 per cent, and therefore the CMHC guarantee doesn’t apply.

Southern Georgian Bay has experienced a vibrant winter in spite of unseasonably warm weather conditions. Thornbury’s growth is noticeable with a new Foodland, LCBO and lively downtown core. The Blue Mountain Village is bustling with skiers, visitors and local residents all enjoying winter activities and terrific ski conditions. The surrounding communities are all thriving. All in all, the Southern Georgian Bay real estate market continues to perform well.

Prince Edward County Real Estate Market Update – February 2016

Property, property, everywhere property, wherever you look in Prince Edward County (“the County”), but hardly a listing for sale! Well perhaps a slight exaggeration, but the scarcity of property for potential buyers has definitely been a consistent story these many months in the County. The County is not unique in this regard, but rather this appears to be a recurring refrain across southern Ontario in many of the markets served by this brokerage. With low interest rates continuing to support healthy demand, inventory has not been able to keep up. February is no exception and this appears to be the determinative force in the market outlook moving into the spring months when the real estate market in the County traditionally picks up and comes alive.

According to the latest numbers released in its Enhanced Statistics Statistical Query Report, The Quinte and District Association of REALTORS® (“the Quinte Board”) disclosed that only 85 new properties came onto the market in the County in the month of February, a 14% drop from last year when 98 were reported as being listed. This number is also down significantly even from January when 104 properties were listed (which itself was a 32% decline from the numbers reported for the same month the year previous). These numbers combined to bring year to date figures to 189 which marks more than a 24% decline from last year at this time when a total of 250 new listings had been logged by the Quinte Board. The net effect of all of this is that there is simply less to buy with inventory being calculated at only 368 active listings across the County which is 26% less than was available last year at this time when 496 active listings were recorded when the Enhanced Statistics Statistical Query Report was issued.

818 COUNTY ROAD 5 RD, PRINCE EDWARD COUNTY, HALLOWELL WARD | $1,249,000

Not surprisingly, sales have not kept up with last year either, though the numbers do not trail the decline in inventory to the same degree. Rather the number of properties sold in the County was only two fewer than last year, 22 as compared to 24, an 8% drop. Year to date then, 41 properties have been recorded as sold in the County in 2016 compared to 48 last year at this time, which makes for a 14.5% drop. All in all therefore, sales have not fallen as quickly or at the same rate as inventory. The numbers actually suggest that there is steady demand, but you simply can’t sell what isn’t for sale. With buyers chasing after fewer properties, the market remains tight and the average sale price for properties sold reflects this. The Quinte Board reports that the average sale price for February 2016 came in at $287,488, 22% higher than one year ago when it was calculated to $234,354.

NEXT TO 12696 LOYALIST PARKWAY (HIGHWAY 33) , HALLOWELL WARD | $289,000

Finally, according to the numbers released by the Quinte Board, it actually took longer to sell the particular sample of properties that did sell in February compared to those that sold in the same month last year, specifically on average 114 days compared to 72 days in February 2015. While this number is not definitive in what it indicates, it could be interpreted as indicating that with as little on the market as there is, even the harder to sell properties that had been languishing on the shelf were selling as there is limited new product to choose from.

65 & 71 & 77 BRIDGE ST, PICTON WARD | $2,999,000

Generally speaking, the state of the County real estate market remains on strong footings moving into the rest of the year. As indicated, the cost of financing remains affordable as is the price point for the area compared to comparable markets served by this brokerage. After considerable economic volatility, particularly in the equity markets, precipitated in large part by the collateral negative impacts from falling oil prices as well as an ongoing sputtering recovery in other economic sectors and a lackluster domestic job market, conditions appear to have stabilized somewhat with the American economy continuing to gain traction and some of the positive spin offs from a lower Canadian dollar starting to take root. One clear message stands out and that is, taking all of the foregoing into account, property owners contemplating putting their property on the market should not hesitate to do so as demand is strong and property is scarce, and it is reasonable to expect a positive uptake and reception for any property that reflects good value.

Toronto Real Estate Market Update – January 2016

The new year started strong, producing 4,672 residential resales, an increase of more than 8 percent compared to the 4,318 sales the market produced during January 2015. The big story early in the year is not sales, but the lack of inventory.

In January only 8,957 new properties became available for sale in the greater Toronto area. This compares poorly against the 9,547 new listings in January 2015, a decline of over 6 percent. The number of new listings combined with the properties that sold in January means that at the beginning of February there were only 9,966 properties available for buyers to purchase. This is a decline of almost 15 percent compared to the 11,600 properties available last year and an even bigger decline than 11,903 properties available for sale in February 2014.

ROSEDALE: 337 Wellesley St, Toronto | $1,499,000

These numbers are exceptionally low. They translate into only 1.8 months of inventory in the greater Toronto area and 2.1 months in the city of Toronto.The difference is due to the larger supply of condominium apartments available for sale in the city, predominately in the central core. In early 2015 there was 2.2 months of inventory in the greater Toronto area and 2.4 months in the city of Toronto. These numbers favor sellers but create a troublesome imbalance in the market place. In same trading areas the lack of inventory has reached serious levels of concern. For example in the trading area that encompasses the Riverdale and Leslieville neighbourhoods, there are only 1.1 months of inventory, a record low.

The problem with these low inventory levels, aside from the fact that they leave buyers frustrated and prevent first time buyers from becoming homeowners, they are placing incredible upward pressure on sale prices.

In January the average sale price for the Toronto area came in at $ 631,092, more than 14 percent higher compared to January 2015’s average sale price of only $ 552,929. In the city of Toronto the number is even higher, and the average sale price in the central core, including all condominium apartment sales which took place in January, is now $ 731,243. If inventory levels stay low the continued pressure on prices will put sustainability in question.

HOGGS HOLLOW: 3 Campbell Cres, Toronto | $4,498,000

Activity was not restricted to the lower priced properties in January. For example, 88 properties having a sale price in excess of $2 million sold in January. This compares with only 44 such sales during the same period last year, an increase of 100 percent. The tight market conditions have driven the average sale price for a detached home in Toronto to $1,061,789 and a semi-detached home to $ 713,972. The problem with semi-detached homes is that there are hardly any available to buyers. There were 10 trading districts in Toronto that had no semi- detached properties listed for sale in January.

LEASIDE: 25 Malcolm Rd, 506, Toronto | $434,000

In the city of Toronto the only abundant source of available inventory is condominium apartments. In January there were 3,231 active condominium apartments listings. This supply represents almost 70 percent of the total available inventory of residential properties listed for sale in Toronto. It is not surprising that buyers are turning to condominium apartments as their only housing choice. In January condominium apartment sales were up by 11.6 per cent compared to last year. Prices jumped by 8.6 percent. In January the average sale price for a condominium apartment was $416,104. In Toronto’s central core the average sale price was $469,723.

It will be interesting to see what happens in February. It is unlikely that tight inventory levels will improve, which means the pressure on prices will continue.  The turmoil in equity markets may have an impact on sales, particularly the upper end, where choice rather than necessity plays a role in buying and selling decisions. Lastly on February 15^th the new lending rules come into effect. After that date high ratio buyers will have to come up with 10 percent downpayments on loans that exceed $500,000. They can still make 5 percent downpayments on the first $ 500,000 of the loan amount. It is not anticipated that this change will have a negative impact on the greater Toronto resale market place.

Report written by LLB, Chestnut Park Real Estate President and CEO, Broker of Record Chris Kapches

Toronto Real Estate Market Update – December 2015

It’s almost anticlimactic to write about the Toronto residential resale market for December and year end 2015. The anticipation of a record breaking year had evaporated by September. Barring some economic catastrophe, by the early fall it was becoming apparent that the long standing record of 93,193 sales achieved in 2007 was going to fall this year and it did, dramatically.

By year-end 101,299 properties were sold by Toronto and area realtors, and that does not include the thousands of new construction properties that were sold over the same period. The sales achieved in 2015 exceeded the 2007 record by almost 10 percent.

That was not the only new record that was established in 2015. The average sale price for 2015 came in at $622,217, the highest annual sale price in history. It shattered the previous high of $566,624 achieved in 2014. This also represents an increase of almost 10 percent.

The rising average sale price for properties now means that it costs more than $1 Million to buy a detached house in Toronto. In December that number came in at $1,039,638. It also means that a large segment of Toronto’s resale market is now composed of properties with sale prices that exceed $1 Million. In 2015 10,867 properties were reported sold in this category, almost 11 percent of the entire market. In 2014 only 7,364 properties above this price point sold. Similarly $ 2 Million plus sales also increased dramatically in 2015. There were 1668 properties sold in this price point, a 43 percent increase over the 1,168 sold in 2014.

A concern throughout 2015, and one that will impact the Toronto and area resale market at least in early 2016, is the supply of inventory. At year-end there were only 1.8 months of inventory in the greater Toronto area. In 2014 there were 2.2 months, also low.

In the City of Toronto there were 2.2 months of inventory at year end. This compares with 2.4 months of inventory at the end of 2014. The larger supply in the City of Toronto is due to the high number of condominium apartments available for sale.

Condominium apartment sales were also a bright spot in 2015. In December 30 percent of all properties reported sold in the greater Toronto area were condominium apartments, almost 15 percent more sales than for the same period in 2014. On average that ratio of sales, between condominium apartments and freehold properties, was achieved every month during 2015. That means that more than 30,000 of the 101,299 reported sales for 2015 were condominium apartments, the bulk of these sales, approximately 60 percent, taking place in the City of Toronto. In the City of Toronto the average sale price for condominium apartments came in at just over $400,000, a long way from the cost of detached and semi-detached homes. Condominium apartments have become the entryway for first time buyers into Toronto’s record breaking market.

Although 2015 ended on a market high, a number of negative economic changes began in December and cloud the horizon as we attempt to peer into 2016. In December the Toronto stock market dropped precipitously, a drop that has continued into the first week of January. The Bank of Canada has reduced its 2016 forecast to less than 2 percent growth, probably closer to 1.5 percent. The west continues to suffer as a result of declining oil prices. As of the preparation of this report oil prices were hovering at $30 a barrel, the lowest they have been in more than 10 years. On the international scene China continues to struggle, with no sign of a change in it stagnating economy. When the Chinese economy slows, commodity oriented countries such as Canada are immediately impacted.

The falling Canadian dollar is both a positive and negative factor in the economy. It clearly makes Canada’s exports more attractive, but conversely it makes buying imported goods more expensive, making life more expensive for Canadians. It does mean that we will not see an increase in the bank rate anytime soon, which in turn means a continuation of historically low mortgage rates. It may be that these low rates, combined with Toronto’s attraction for new immigrants and those migrating from less prosperous areas of Canada, or what has been called the “Switzerland appeal,” may once again power the Toronto residential resale market to another record year .Given the number of properties that sold in 2015, a more prudent analysis would suggest that the Toronto and area market will come off the highs of 2015 and produce sales of closer to 95,000 properties in 2016, which would still make 2016 the second best year on record.

Toronto Real Estate Market Update – November 2015

Two more market records were broken by the performance of the Toronto resale market in November. The first was the sales results for the month of November. Toronto area realtors were responsible for 7,385 property sales in November. This result represents the highest number of reported sales ever achieved for the month. By comparison only 6,476 sales were reported in November 2015, an increase of more than 14 per cent. This is an incredible achievement at a time normally associated with the beginning of the holiday season when buyers in particular are focused on matters other than real estate.

Secondly, and perhaps more importantly, by month end the Toronto Real Estate Board had reported 96,401 residential resales for 2015. This number shattered the previous annual record of 93,193 sales achieved back in 2007, with one more month to go before the greater Toronto’s sales totals are finally calculated. Last December there were 4,418 reported sales. If this December’s results are equal to last year’s, and the anticipation is that they will be higher, 2015 will close out with almost 101,000 sales. This would be a 5 per cent increase over the record year of 2007.

The growth in sales can be attributed to the increase in condominium apartment sales since 2007. Over the past eight years numerous condominium projects have reached the registration stage, and consequently have become available for resale. In November there were 1,198 detached and semi-detached properties reported sold in Toronto’s 416 districts. In the same month 1,351 condominium apartments were reported sold, almost 13 per cent more than the total amount of free-hold properties sold.

The average sale price for condominium apartments was $415,316, much lower than the average sale price for detached and semi-detached properties. In November the average price for a detached house in Toronto came in at $1,018,621. Semi-detached properties came in at $750,608. It is clear that for many buyers the only affordable alternatives are condominium apartments.The average sale price for all properties sold in the greater Toronto area was $632,685, almost 10 per cent higher than the $577,502 achieved in November 2014. The average sale price for 416 area sales came in at $654,221, about 4 per cent higher than the broader greater Toronto area market.

The number of listings coming to market has been increasing over the last few months, but still insufficiently to meet demand. In November 9,609 new properties came to market, a 10.2 per cent increase compared to the 8,716 properties that came to market last year. Notwithstanding this increase, at month end the Toronto market was still almost 9 per cent short of the number of listings it had in 2014. Last year there were 14,717 active listings at the end of November. This year we enter December with only 13,454 active listings.

In November 130 properties were reported sold having a sales price of $2 Million or more, a very healthy number for November. Aside from the high end market, as we near the end of the year the concern remains that Toronto’s average sale prices have reached levels that might not be sustainable. The historically and exceptionally low mortgage interest rates have been the primary reason for the record breaking sales that have taken place throughout this year. Fortunately there is no immediate risk of rates rising. The Canadian economy continues to be sluggish, particularly in Western Canada were less than $40 a barrel oil prices have crippled real estate sales. If average sale prices continue to rise at their recent double digit pace, any increase in mortgage interest rates will see sales stall and prices level off. Continued rising inventory levels will help ease this potentially dangerous situation from developing.

Toronto Real Estate Market Update – September 2015

During a year in which numerous records have been established by the performance of the greater Toronto residential resale market, it is not surprising to discover that a new record was set in September. The 8,200 properties reported sold was a record number for properties sold for any September since the Toronto Real Estate Board has been maintaining statistics. September was just another month in a string of months in which Toronto area buyers remained determined either to buy for the first time or move up to a more expensive property. As a result, the cumulative total of reported property sales for the first 9 months of 2015 is 80,331. The record for sales, set in 2007 at 93,193, when the average sale price was only $376,236, is on the verge of falling.
If there is a concern with the Toronto resale market place it is available inventory. Notwithstanding that September was a record breaking month, the positive variance of reported sales as compared to September 2014 was only 2.5 percent, the lowest positive monthly variance in almost two years. There is simply not enough freehold, detached and semi-detached supply, to meet the constant demand for housing in Toronto.
It is the lack of supply that is primarily responsible for the constantly increasing price of housing in Toronto. It now costs more than $1 Million to buy the average detached home. In Toronto’s central districts the average price of a detached house is now almost $1.7 Million. There are districts in the west (Kingsway) and districts in the east (Riverdale and the Beach) where the average sale price for a detached house is also $1 Million or more.
Overall the average sale price for the greater Toronto area came in at $627,395, 9.2 percent higher than last September’s average sale price of $574,424. Toronto’s average sale price has practically doubled in the last 10 years. In 2005 the average sale price was a mere $335,907. No doubt these constantly rising prices have been motivating buyers to get into the market and become homeowners. That and the historically low interest rates.
Aside from rising prices, the market has changed in other ways since 2005. In September 2005 the market reported 7,326 property sales. At the time that was a record, as September 2015’s 8,200 sales established a new record. In 2005 it took almost 40 days for all properties to sell. This September the average days on the market was only 22, and that number was made higher by the large number of condominium apartments included in that statistic. In the last decade the manner in which buyers purchase properties has clearly changed. The slow, deliberate process no longer exists. Today buyers are more educated, by their realtors and by information in the public domain (realtor.ca). They now know what they want, and when it becomes available, offers are submitted, which often result in multiple and pre-emptive offers. In some districts the average days on market can be calculated in single digits.
The other major change between 2005 and today is the price that buyers will pay for properties on the market. There were few instances where buyers paid asking or slightly higher in 2005, and when they did it was not with the consistency in the overall market that we witness today. In September all detached properties across the entire greater Toronto area sold for 100 percent of their asking price. In the city of Toronto it was 101 percent. All semi-detached properties sold for 102 percent of their asking prices. In the city of Toronto it was an eye-popping 105 percent, 107 percent in the eastern districts and 106 percent in the central districts, where the average sale price for a semidetached property came in at almost $1 Million.
Sales of properties were not restricted to the lower end of the market. There were 903 properties reported sold having a sale price in excess of $1 Million, 154 having a sale price of $2 Million or more. In September there were 32 properties reported sold having a sale price in excess of $3 Million, 28 percent more than the 25 properties sold in this category in September 2014. It would appear that the high end of real estate sales in Toronto now begins at $3 Million.
Going forward the concern is the shortage of inventory and the impact it will have on prices and ultimately on affordability. At the end of September there were 16,165 properties available for sale, 7.3 percent less than the 17,765 that were available at the same time last year. That translates into only 1.9 months of inventory in the greater Toronto area, and 2.2 months of inventory in the city of Toronto, the higher level of available inventory due primarily to the high concentration of condominium apartments. This shortage of inventory will continue to generate competition for detached and semi-detached properties that become available for sale, and sale prices will continue to escalate. Given the demand in Toronto, the only thing that will prevent October’s numbers from reaching new records is the lack of available properties for sale.

Toronto Real Estate Market Update – June 2015

Once again the Toronto residential resale market posted new records for market performance. The first was the 11,992 properties reported sold, the highest number of properties reported sold for the month of June since the Toronto Real Estate Board began tracking Toronto area sales. June’s reported sales were 18.4 percent greater than the 10,132 properties reported sold in June 2014.

There is no doubt that historically low mortgage interest rates continue to be the driver of Toronto’s residential resale market place. Low interest rates and tight inventories, particularly in the City of Toronto have been responsible for many of the records that have been established in 2015.

Despite the high volume of sales in June, a new record for the monthly average sale price was not established. The average sale price came in at $639,184. Although this monthly average sale price was more than 12 percent higher than the average sale price for June 2014, it did not exceed May’s average sale price of $ 649,800, which remains the record for the greater Toronto area. The average sale price for the City of Toronto came in at $682,264, almost 7 percent higher than the average sale price for the greater Toronto area. This number would have been substantially higher if it did not include the numerous condominium apartment sales which form the bulk of properties sold in the City of Toronto. Condominium apartments (see below) are selling at prices 38 percent lower than the average sale price for all properties sold in the City of Toronto.

In June all properties (on average) sold in 19 days. Last year it took 22 days for all properties to be reported sold. Interestingly properties sold faster in May. In May it took only 18 days for all sales to take place. Nonetheless 19 days remains a blistering pace, especially when it is considered that these sales include 2,700 condominium apartments, which are selling at a less robust pace than freehold properties. As we have seen in previous months in 2015, the pace of sales varies depending on trading district and housing type. As has been the case all year, the eastern districts remain the most robust. In June all detached properties in the eastern districts sold in 11 days at sales prices averaging 104 percent of their asking prices. Semi-detached sales were even faster. All semi-detached properties in the eastern districts, and there were 189 of them, sold in an eye-popping 8 days and for sale prices averaging 106 percent of the asking prices. These are unprecedented numbers.

Although not as frothy, sales of detached and semi-detached homes in the City of Toronto’s central districts were also dramatic. In central Toronto the average price for a detached house came in at $1,664,694. For the City of Toronto the average price was $1,051,912, both numbers establishing new benchmarks for detached property sales. Not only were these average sale prices unprecedented, but sales took place in 19 and 16 days respectively, and for sale prices 101 and 102 percent of their asking prices. It is clear that notwithstanding the steep rise of prices for detached and semi-detached homes in the central districts, Toronto buyers have an insatiable appetite for these housing forms.

Condominium apartment sales established a record of their own. Condominium apartment sales were up an amazing 21.3 percent compared to June of 2014. In June 1,906 apartments were reported sold in the City of Toronto (416 area). These sales represented 43 percent of all sales in the City of Toronto for the month of June. Although the volume of sales was up dramatically, it was not matched by the increase in the average sale price. The average sale price for condominium apartments came in at $418,599, up 7 percent compared to June 2014, but is still considerably lower than average sale prices for freehold properties.

Although more condominium apartments are selling and at higher prices, they are not selling as fast as detached and semi-detached homes, nor are they selling for prices exceeding list prices. In June all condominium apartments in the City of Toronto sold in 27 days, 8 days slower than freehold properties. In addition all apartments sold for only 98 percent of their asking prices. As was mentioned earlier, inventory levels continue to be a problem for buyers. In June 17,746 new listing became available in the greater Toronto area. This was an increase of 6.7 percent compared to the 16,633 that became available in 2014. Notwithstanding this increase, entering July there are 13.1 percent fewer available properties for buyers to purchase than there were last year at this time. Last year there were 20,686 available properties, this year there are only 17,972. Translated into months of inventory we see that there are 2.0 months of inventory for the greater Toronto area and 2.2 months for the City of Toronto, The 5,208 condominium apartments for sale account for the slightly higher months of inventory in the city of Toronto. In both cases, however, 2.0 and 2.2 months of inventory reflect strong seller markets. Looking forward I anticipate a small pull back in the market in July. This is consistent with historical seasonal cycles. Last July the market retracted by about 10 percent compared to June. Expect a similar retraction when July’s numbers are reported. One thing is clear, the annual record for most reported sales is well on its way to being shattered in 2015.

Collingwood/Southern Georgian Bay Real Estate Market Update – June 2015

SOUTHERN GEORGIAN BAY HOME SALES SET NEW ALL TIME RECORD!

Residential sales recorded through the MLS® System of the Southern Georgian Bay Association of REALTORS® came in well above year-ago levels in June 2015.

The Southern Georgian Bay Association of REALTORS® comprises two distinctive markets. We are reporting on activity for the Western Region which includes Wasaga Beach, Collingwood, Clearview Township, The Blue Mountains, Municipality of Meaford and Grey Highlands.

The total number of sales for June 2015 is 275, up a strong 22% 2014 (225 sales). The total number of sales YTD is 1145 units, showing a 20% increase from 2014 (952 sales). The total sales dollar volume for June 2015 was $89,117,146 up 23% from 2014 ($72,196,799). The total sales dollar volume YTD was $384,477,410 up 27% from 2014 ($303,610,407). Dollar volumes reached new all-time records in June!

The average price of a residential home sold in the Western District was $323,467 in June. This was an increase of 1.2 per cent from a year earlier.

The number of new residential listings in June 2015 was 442 units, falling 9% per cent from a year earlier (485 for 2014). The total number of listings YTD is 2516, down by 14% from 2014 (2917).

As an overview …. Here are some interesting highlights from the recent CMHC Housing Market Outlook for Ontario for 2015/16, with regard to resale homes;

• Demand for resale homes will hold up better versus new construction demand over the forecast horizon.

• Modest wage growth and eroding affordability will support demand for less expensive resale homes.

• Demand for single detached homes will ease as mortgage carrying costs continue to rise.

• Ontario existing home sales could be closer to the higher end of range if employment grows faster than expected.

• Alternatively, sales could be closer to the lower end of the range should affordability erode faster than expected.

CMHC has this to say on Economic Forecasts for Ontario 2015/16;

• After a period of modest growth during the post-recession period, Ontario’s economy will gain momentum and outpace growth in the rest of Canada for 2015 and 2016.

In closing, as we enjoy a stable, low risk real estate environment, the Southern Georgian Bay communities are poised for a great summer! There is an abundance of special events, theatre, outdoor activities, festivals, farmer’s markets, hiking trails, beach visits and so much more to enjoy!