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.

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.

Prince Edward County Real Estate Market Update – December 2015

As is the case every year, with January comes a look back at the year just passed and new year musings as to what the coming year will bring. This year is no different. With all of the figures reflecting the performance of the Prince Edward County (“the County”) real estate market in for 2015; sales and listings numbers logged, reviewed and justified,then recorded in the Enhanced Statistical Query Report produced by the Quinte & District Association of REALTORS® (“the Quinte Board”); the very strong and positive performance of the 2015 market is confirmation of the fact that the County has definitively taken its place on the map as a go to destination of choice in Southern Ontario.

The County real estate market closed out the year on a very strong note with December’s figures defining tight market conditions with limited product, ongoing strong demand, and rising average sale prices. December’s real estate performance contributes to the strengthening trend experienced in the County throughout the year, ending the season on the same high note. Having said that, 2016 has started off on a rather negative economic footing with steep declines in the equity markets, both here and south of the border, further compounded by falling oil and commodity prices which so far appear to be outweighing any consequential positive impact of the sliding dollar on the manufacturing and export markets. This mixed with historically high household debt levels and the potential for moderate tightening in lending conditions may add to the broader economic pain being experienced across the country, and dampen real estate prospects somewhat for the year to come.

As stated in earlier reports, the smaller sampling of properties represented in the wards that constitute the County real estate market inevitably results in greater statistical swings depending upon the particular cross-section of sales that took place within the period in question, but continues to provide some indication of market strength and the direction in which it is trending. According to the Enhanced Statistical Query Report, the Quinte Board reported a 14% increase in sales in the month of December compared to the last month of the year in 2014. Specifically 33 properties were reported sold this December compared to 29 last year. That brought the total number of properties sold in the County in 2015 to 591 as set out in the Quinte Board Enhanced Statistical Query Report representing reconciled annual sales from the period spanning January 1 through December 31, 2015. This constitutes an 8% increase over the 548 sales recorded in the County during 2014.

Sales across the entire Quinte Board were equally robust with sales in December besting those from the year previous by 8% (188 vs 174) and annual figures coming in15% better than in 2014 with a grand total of 3399 properties changing hands compared to 2966 the year before.

As indicated, property supply remains tight with listings down again in December with only 40 new properties coming onto the market compared to 46 the year previous, a further 16% decline bringing the annual deficit in listings for 2015 to 9% with a total of only 1418 properties coming onto the market this year compared to 1555 last year. Not surprisingly, combined with the robust pace of sales, year-end reported inventory was down 23% for the month of December with only 280 active listings compared to 362 at the same time the year previous. Listings for the broader Quinte Board are also down 7% for the month year over year and 3% overall on an annual basis.

As an aside, the properties that did sell in December took 26% longer to sell than did those that sold in December the year previous, potentially reflecting the fact that the limited supply of properties is pushing sales to properties that otherwise would not have sold and had been lingering on the market. Interestingly enough, annual comparisons for the entire year also reflect a longer time period to sell the properties that did sell despite the higher volume of properties that changed hands. Perhaps again that is a reflection of the fact that more of the older supply of properties that would otherwise not be reflected in the sold statistics were being snapped up with the hotter market.

Finally, consistent with the fundamental principles of supply and demand and the logical outcome of a stronger market with tight or limited supply, average sale prices continue to rise. In December the average sale price came in at $329,788, a whopping 47% above the figure recorded in December 2014 when the average sale price for the month was $224,272. Even spread over a longer period of time, and representing a broader cross-section of properties, the increase in the average annual sale price for 2015 compared year over year with 2014 was 17% ($304,075 in 2015 vs $$259,406 for 2014), a hefty increase reflecting the heightened real estate activity and interest in the County.

All in all an impressive performance and a positive note to end 2015, and a promising way to ring in the New Year. Only time will tell what 2016 will bring considering some of the economic clouds on the horizon and some rumbling in the world of debt financing. That said, County properties remain well positioned moving forward with respect to comparative value and affordability, and will continue to benefit from the natural attributes of the area including its scenic beauty and proximity to higher priced and vibrant urban centres.

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.

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.

Report prepared by Chestnut Park’s CEO Chris Kapches

Prince Edward County Real Estate Market Report – June 2015

As we finally move into the warmer months and watch the picturesque landscape of Prince Edward County (“the County”) come to life with the fields, orchards and vineyards beginning to show signs of the bounty for which the area is renown, the Quinte & District Association of REALTORS® (“the Quinte Board”) has produced its statistics for the month of June, confirming that the real estate market in the County this year is playing out very much as it did last year at midpoint in the season, with remarkably consistent buying and selling behaviour as well as property listing and inventory trends. Generally speaking sales are proceeding at a pace that is both strong and steady, reflective of a solid and enduring market that is neither volatile nor fickle, but rather rooted in excellent and established fundamentals of value associated with the area.

Further to this, according to the Enhanced Statistics Statistical Query Report prepared by the Quinte Board for the month of June, 71 properties sold across the County, 2 more than last June when 69 properties were reported as sold, constituting a moderate 3% increase. As indicated year to date sales are closely mirroring those of last year at this point with 268 so far compared to 271 last year at the half way mark, a virtual dead heat. The Quinte Board generally, however, which covers a much broader area including Belleville, Brighton, Trenton, Madoc and Marmora amongst other centres continues to report more significant gains over last year’s numbers, reporting a 35% increase in sales Board wide with 448 reported sales this past June compared to 332 the year previous. Year to date numbers also reflect a substantial year over year increase of 20% with 1784 sales thus far compared to 1484 in the first half of 2014. The higher price point in the County may have something to do with this differential as well as the particular economic and demographic trends in the respective areas.

Continuing on with the overall story of stability, listings too are remarkably consistent with last year. According to the Enhanced Statistics prepared by the Quinte Board, 145 new listings came onto the market in the County in June, only one fewer than in June of last year. The year to date picture is no different with a grand total of 920 new properties being listed compared to 918 last year at this time. Not surprisingly then the inventory is virtually the same as it was last year at the end of June with 714 active listings on the market compared to 716 last year, truly a negligible difference. As for the Quinte Board generally, the June report indicated a 3% increase in listings over last year with 765 new properties coming out across the Board compared to 746 last year, with year to date figures reflecting a similar trend and a 4% gain (4423 as compared to 4258 in 2014).

The steady and solid performance of the real estate market in the County is further shored up by a 6% increase in average sale price across the region. In June, the average sale price of a property sold in the County was reported as being $261,556 compared to $245,707 the year previous.

Finally the particular cross-section of properties that sold across the County were sold on average in 97 days which based on this particular sampling is 40% longer than last year when calculations for the month of June established an average of 69 days on the market for properties before selling.

Overall, based on the performance of the property market in the County for the first half of the year, the remainder of the year is likely to play out in similar fashion with no indication of interest rate hikes anywhere on the horizon and general market conditions for the surrounding areas looking relatively stable. The main qualifier appears to be the broader economic climate with some significant ripples being experienced in international markets, particularly in Europe with the Greek monetary crisis, and in China’s equity markets. The extent to which all of this will affect the broader performance of the Canadian economy is still unclear. Global factors aside recent reports continue to show that Canada still has a way to go before its economy is back firing on all cylinders and trade figures are consistently more positive.

Prepared by: Richard Stewart, Vice-President & Legal Counsel, Chestnut Park Real Estate Limited, Brokerage

Toronto Real Estate Market Update – May 2015

The Toronto residential resale market posted new records for sales in May, as it has in previous months this year. Historically low mortgage interest rates, extremely low inventory levels, especially for detached and semi-detached properties, are the dominant drivers of the market. At the end of May there were 18,858 properties available for sale, more than 10 percent less than the 20,679 that were available at the end of May 2014. As of the date of preparation of this Market Update buyers can secure a 5 year fixed term mortgage with an interest rate of 2.54 percent, with even lesser rates available for shorter terms. With little likelihood that new listings will increase over the next few months, and mortgage rates holding firm with increases unlikely for the remainder of 2015, expect this market to remain a seller’s market for the foreseeable future.

In May 11,706 residential properties were reported sold for the greater Toronto area. This compares to 11,013 that were reported sold last year, a 6.3 percent increase, and a record month for the greater Toronto area. In April there was a 17 percent increase compared to April 2014. Although there was a pullback from the highs of April, the 11,706 properties sold in May is still very impressive, especially for a market place that has already produced over 30,000 sales in just the first four months of the year.

Last month I reported that the speed at which these properties were selling was unprecedented. In May sales took place at an even faster pace. All properties (on average) sold after only 18 days on market. In April all properties sold in 20 days. Last May all properties were reported sold in 21 days.

In some trading districts the pace of sales can only be described as blistering. For example all properties in the eastern trading districts sold in only 13 days. That represents 1,132 properties. It is difficult to find superlatives for this market. In Toronto’s central districts all detached properties, 490 of them, sold in just 13 days, and for an eye-popping average sale price of $1,731,998, and 102 percent of the asking price.

Sales of semi-detached homes in the central districts were even faster. All semi-detached properties sold in just 10 days at an average sale price of $966,948, and for prices that were 106 percent of their list price. Breathtaking results. In the eastern districts, because of lower price points and even fewer properties available for sale, sales for detached and semi-detached properties were even faster.

It will be of no surprise to anyone following these market statistics that average sale prices continue to rise. In May the greater Toronto area market place established a new record for monthly average sale prices, coming in at $649,599, and eclipsing the previous record of $635,899 which was only achieved in April. May’s average sale price of $649,599 was more than 11 percent higher than the average sale price of $584,946 that we saw in May 2014. Ironically, at that time, it was also a record average sale price for the greater Toronto area. The average sale price for homes in the City of Toronto (416 area) is even higher, coming in at $718,350. Currently Toronto’s least expensive area to live in is the eastern districts. The average sale priced there is only $584,567, but a buyer will have to go quite a ways east to find the average priced home. The eastern districts closer to the city’s central core are averaging over $800,000.  As I have indicated in previous reports, these numbers would be even higher if condominium apartment statistics are not included. As the market progresses we are seeing even condominium prices also increasing, and fairly dramatically.

In the City of Toronto, where most condominium apartments are located, condominium apartment sales increased by almost 13 percent compared to May of 2014. This 13 percent increase represented 1,762 sales, which in turn represents 42 percent of all sales that took place in Toronto. Not only were volumes up, but so were average prices. In May the average sale price for condominium apartments came in at $422,947. It was only a few months ago that the $400,000 threshold was exceeded. In Toronto’s central core the average price for a condominium apartment is rapidly approaching $500,000. In May the average sale price came in at $492,100.

It should be noted that notwithstanding rising volumes and sale prices for condominium apartments, the pace of sales, though improving, lags behind freehold sales. In May it took 27 days for all condominium apartments to sell in Toronto, 15 days slower than detached properties and an incredible 18 days longer than semi-detached properties. Unlike detached and semi-detached homes condominium apartments are not selling for more than their asking prices. In May condominium apartments on average sold for only 98 percent of their list price.

Properties selling with a sale price of $1 Million or more are now becoming the norm in Toronto. In May 1,412 properties having a sale price of $1 Million or more were reported sold. Million dollar plus property sales now represent more than 12 percent of the overall market place. It should be noted that 240 properties were reported sold having sale prices exceeding $2 Million.

New records are being created monthly. At this pace the record for the most sales in a year is very likely to be shattered. In 2007 93,193 properties were reported sold. At that time the average sale price was only $379,347, 73 percent less than it is today. Short of an economic catastrophe, 2015 will end with reported sales exceeding 100,000 properties.

Toronto Real Estate Market Update – April 2015

The Toronto residential resale market continues to strengthen as we move into the spring buying and selling season. Month after month the greater Toronto market reaches new milestones. All home types, including condominium apartments, saw both price growth and growth in the volume of properties sold.

In April 11,303 properties were reported sold in the greater Toronto area. This compares to only 9,660 sales in 2014, an increase of 17 percent. The increase of 17 percent is the highest year-over-year increase in sales on a monthly basis since before the 2008 recession. Although an increase of 17 percent pales in comparison to some of the recent increases experienced by the Vancouver market, by historical comparison a 17 percent increase is dramatic and unprecedented. For example, last month saw an increase of 10 percent compared to March 2014. That was the first double digit increase in years.

Not only did we see unprecedented sales volume, but all properties sold in record breaking time. All 11,303 properties reported sold (on average) sold in just 18 days. Last April, which was also a very fast sales month, all properties sold in 20 days. Certain housing types in various Toronto trading areas sold even faster. All detached properties in Toronto’s central core sold in just 15 days. They sold for 103 percent of their asking price. The average sale price for these properties? A record $1,591,721. Although prices were dramatically lower in the eastern trading areas, all detached homes in these districts sold in just 11 days at 105 percent of their asking price. The average sale price of these eastern district homes was $746,110, a record price, almost 16 percent more than what detached homes in the eastern districts sold for last year.

Given the high volume of sales and the speed with which they took place it is not surprising to see that the average sale price for all properties sold in the greater Toronto area also set a new monthly record. The average sale price for all properties sold came in at $635,932, a 10 percent increase compared to April 2014’s average sale price of $578,354. April marks the third consecutive month establishing a new record high for average sale prices in the greater Toronto area.

In the city of Toronto the average sale price was even higher. It came in at $690,261. This is a remarkable number when one considers that it includes the 1,706 condominium apartments that were reported sold. If condominium apartment sales are removed, the combined average sale price for detached and semi-detached homes in Toronto would be about $900,000, and dramatically more in some of the more sought-after neighborhoods.

The continually rising average sale price for Toronto properties is redefining the meaning of “luxury”. In April 1275 properties having a sale price that exceeded $1 Million were sold, another record. That represents a 54 percent increase compared to the 828 that sold in the same category last year. There were 195 properties sold that had an average sale price of more than $2 Million. Last year only 135 sold in this category. The “high end” of the market continues to grow every month. In April the 1275 reported sales over $1 Million represent more than 11 percent of the overall market. It is humourous to note that in the midst of these high end sales there were 6 properties that sold having a sale price less than $100,000.

Inventory levels continue to be a problem, contributing to rising prices and the pace of sales. In April 17,248 new properties came to market. Unfortunately this was 5 percent less than the 18,177 that became available to buyers in 2014. The cumulative effect of the monthly shortages is that the Toronto market enters May with only 17,182 properties available for sale, more than 10 percent fewer than the 19,118 that were available to buyers last year. These inventory shortages account for the growing phenomenon of multiple buyers bidding for the same property. This auction-like environment also contributes to the rapidly rising average sale price for properties in Toronto.

For first-time buyers condominium apartments are their only housing refuge, and the numbers indicated that that’s where first time buyers are flocking. In April 1,706 condominium apartments were reported sold, an increase of almost 14 percent compared to last year. These sales represented more than 22 percent of all reported sales. In the city of Toronto condominium apartment sales represented 42 percent of all reported sales.

Prices of condominium apartments are beginning to creep up. For the first time, the average sale price for condominium apartment sales in the city of Toronto exceeded $400,000 ($407,612). In central Toronto, where most apartment sales take place, the average sale price came in at $465,143, another record. Without the financial help of parents, even condominium apartments would be beyond the reach of many first-time buyers.

As we move into May we are firmly on pace to break the 2007 record of 93,193 sales for the entire year. With 30,854 sales already reported in the first four months of 2015, we can anticipate yearend sales exceeding 100,000 properties.