Toronto Real Estate

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

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

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

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

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

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

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

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

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

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

We have run out of superlatives to describe the greater Toronto residential resale marketplace. Records have been broken consistently for the last few months, and September was no exception. Two records were shattered in September: most sales ever recorded for the month, and the highest average sale price for all properties reported sold.

In September 11,083 residential resale properties were reported sold. This is more properties reported sold than in any previous September. By comparison, last September 7,791 properties were reported sold. This year’s sales were 42.3 percent higher than reported sales in 2019. September’s sales brought the year-to-date total to 68,793, 1 percent higher than the number of reported sales at the same period last year. This means that in the last four months the market has made up for the momentum lost during the implementation of the lockdowns and the provincial emergency measures designed to contain the spread of the Coronavirus in March.

The second record was the average sale price for all properties sold. In September it came in at $960,772. The previous record was set in August at $951,536, and the record before that was set in July at $943,609. September marks the fourth consecutive month in which a new average sale price record has been set. It is almost unfathomable that in April the average sale price was only $820,222. Since April it has increased by 17 percent.

It should be noted that in the city of Toronto the average sale price came in at $1,022,051. This is an astounding number when it is remembered that of the 3,551 recorded sales in the city of Toronto, 1,549, or 44 percent, were condominium apartments. During the pandemic condominium apartments have been out of favour. Buyers have sought out ground level properties that offer outdoor space. In September the average sale price for all condominium apartments sold only rose by 7.7 percent compared to the same month last year. Detached home prices increased by 9.4 percent and semi-detached home prices increased by 7.2 percent (in the city of Toronto).

For the third consecutive month more listings came to market compared to the same month last year. In September 20,420 new properties came to market, a 31 percent increase compared to the 15,616 that came to market last September. Due to the incredible absorption rate in September (11,083 sales), at month end there were 18,167 properties available to buyers, a mere 5 percent increase compared to the 17,254 available last year. In order to experience a balanced market, the marketplace would require an available inventory of at least 25,000 active listings. It is not surprising, given the absorption rate, that throughout the greater Toronto area all properties (on average) sold in just 16 days.

During the pandemic there has been an explosion of higher priced property sales. In September 461 properties having a sale price of $2 million or more were reported sold. This represents an 86 percent increase compared to the 248 properties reported sold in 2019. No doubt the need for space, coupled with historically low interest rates (5 year mortgage rates at less than 2 percent) have driven those that can afford it to larger more expensive properties.

September’s market data provides some empirical proof that buyers are looking for space and ground level properties far from the core of the city of Toronto. Although sales were strong in the city of Toronto – 3,555 sales which amounted to a 20 percent increase compared to the 2,987 properties reported sold in 2019 – that paled compared to what happened in Toronto’s 905 region.

Of the 11,083 reported sales in September, 7,528 of them were in the 905 region. Last September only 4,804 properties were reported sold in the region. Year-over-year this represents a 57 percent increase in the number of sales, substantially and dramatically higher than the city of Toronto. Also, in September, the average price rose by approximately 12 percent in the city of Toronto but by almost 17 percent in the 905 region with South Simcoe County, the region furthest north from Toronto, registering an average sale price increase of 20 percent compared to last year. At this rate average prices in the 905 region will not remain lower than prices in the city of Toronto for much longer. The average priced property in the 905 region, however, does buy more land, and more space compared to similarly priced properties in Toronto. It should be noted that some districts in the 905 region have also become pricey. In September the average price in Halton region was $1,087,859 and $1,066,380 in Peel, both higher than the average price for all properties sold in Toronto ($1,022,051).

Early data for October indicates that it will be as robust as September. Those buyers that have had not been directly and economically affected by the pandemic continue their quest to purchase properties that not only meet their needs but that can act as a sanctuary in these uncertain times. They do so while having access to mortgage financing at less than the rate of inflation.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

Another astounding month for the Toronto and area residential resale market place. August broke two records: one for most sales ever recorded for the month of August and two, the highest average sale price for all properties sold in the history of record-keeping for the Toronto and area market place.

Toronto and area realtors reported 10,775 sales in August. These sales represent a shocking 40.3 percent increase compared to the 7,682 sales reported last year, which was a very respectable August for reported sales. This dramatic increase was predominately driven by an increase in sales of detached and semi-detached properties.

In the City of Toronto detached property sales increased by 65.3 percent and semi-detached properties by an eye-popping 81.2 percent compared to last August. Condominium apartments, for reasons discussed in my July report, did not fare nearly as well, rising by only 9.2 percent.

The Toronto and area average sale price record has now been exceeded for three consecutive months. June’s average sale price of $931,302 exceeded the previous record of $920,000 achieved in April of 2017, the month during which the then provincial government legislated the foreign buyers tax. In July, the average sale price jumped to $943,666, another record. This August it moved closer to the magical $1 Million mark coming in at $951,4014, the new record for Toronto and area resales.

The $1 Million mark has been exceeded for some time in the City of Toronto. Notwithstanding the mix of less expensive condominium apartments, the average sale price for all property sales in Toronto came in at $1,012,506, an amazing 24 percent increase compared to only a year ago. No doubt this increase was driven by the 413 reported sales during the month having a sale price of $2 Million or more, most of which were located in the City of Toronto. The average sale price in the 905 region, by comparison, was only $906,440 for all property types sold in August.

It is not surprising that sales took place at the real estate equivalent of the speed of light. All 10,775 sales for the month took place in only 17 days (on average) after hitting the market. By comparison last year it took 25 days on the market for properties to sell, an improvement of 32 percent. For some property types and depending on location sales took place even faster.

For example detached properties in the City of Toronto sold in only 16 days and for 101 percent of their asking price. Semi-detached properties sold even faster, in only 10 days and for an incredible 108 percent of their asking prices.

In Toronto’s eastern districts the pace of sales was record-breaking. All semi-detached properties sold in only 8 days and for an amazing 112 percent of their asking prices. There was a glimmer of hope for frustrated buyers in August. For the first time since the pandemic, August saw a dramatically high number of new listings coming to market. Almost 18,500 new properties came available to buyers, 56.8 percent more than became available in August 2019. Last year only 11,789 properties came to market.

Due to the high absorption level in August (10,775 sales) at month end there were still only 16,662 properties on the market throughout the greater Toronto area, only 5 percent more than the 15,870 available last year. If new listings continue at August’s pace into September, they will have a profound impact, helping the market to move away from the extreme seller’s market we have been experiencing and ultimately having a moderating affect on average sale prices.

Early September data indicates that September 2020 may be another record-breaking month both as to the average sale price and the number of reported sales. Stay tuned!

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

July’s residential resale market performance was record-breaking. Almost 11,100 properties were reported sold, a 28 percent increase compared to the 8,679 properties sold a month earlier. Compared to July 2019, sales improved by almost 30 percent. There were 8,555 residential properties reported sold last year. July’s numbers are the clearest indication as to the robustness and resilience of the Toronto marketplace, especially when fuelled by record-low mortgage interest rates.

It is no surprise that average sale prices have also increased, also to record levels. In July the average sale price for all properties sold in the greater Toronto area came in at $943,710, surpassing June’s record-breaking average sale price of $931,221. By comparison, last July the average sale price was only $806,971. Notwithstanding the impact of the Covid-19 pandemic, today’s average sale price is 17 percent higher than only a year ago.

In the City of Toronto, the average sale price is even higher. It came in at $1,017,320. This number is particularly impressive when it is remembered that it includes 1,689 condominium apartment sales out of a total of 3,577 properties reported sold.

It is also worth noting that the higher-end of the marketplace exploded in July. In July 452 properties having a sale price of $2 million or more were sold. By comparison, only 185 properties in this category were reported sold last year, an eye-popping increase of 144 percent. No doubt the resurgence of the equity markets has bolstered the confidence of purchasers of higher-priced properties.

The entire residential market has not reacted to the pandemic and its impact on the local economy equally. Condominium apartment sales were negatively impacted during the second quarter of 2020. The quarter saw the tightest economic restrictions and the resulting economic fallout. During the second quarter (ending June 30th), condominium apartment sales were down by over 50 percent, and new listings over the same period were down by almost 22 percent. Notwithstanding these very negative numbers, the average sale price increased by 5.1 percent to $619,707.

In July there was evidence that the condominium apartment market was making a recovery from its poor second quarter performance. In July sales modestly rose by 4.7 percent compared to last year. Sale prices were more robust, rising by almost 9 percent to $682,999 in the greater Toronto area. In the City of Toronto’s central core, the average sale price was a stunning $746,204.

The rental market was also negatively impacted by the pandemic in the second quarter. A combination of restrictions on showing condominium apartment units for rent and job losses across a multitude of economic sectors dampened demand for rental accommodation. As a result, condominium apartment rentals in the second quarter were down by 25 percent compared to the second quarter of 2019, where the number of available condominium apartments increased by 42 percent to 21,703. Not surprisingly, average rents have declined across the board from bachelor to three-bedroom apartments. Except for bachelor apartments, rents declined, on average, by 5.5 percent from a year ago. Bachelor apartment rents, understandably, declined by almost 10 percent. Increased choice has allowed tenants to negotiate rents downwards, a reversal of years of constantly rising rent levels.

Early August results indicate that the resale market will produce strong numbers once again, although not quite as robust as July. On a year over year basis sales will be approximately 10 percent higher than August of last year. It cannot be over emphasized that mortgage interest rates of less than 2 percent will continue to drive the Toronto and area resale market, even in the face of the negative economic impact of the pandemic. Those rates are not expected to rise for some time, perhaps as late as the end of 2021.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

By any standards, the residential resale market’s recovery in June was nothing but phenomenal. The lockdown and emergency measures implemented by the Province in mid-March literally brought the market to a standstill. It stayed that way throughout April, but by early May, we could sense recovery. By May the industry, agents, buyers and sellers had adjusted to the rigid in-person showing protocols – masks, gloves, sanitizers, social distancing, and no-touch viewings. Also, by May, the pent up demand, already present before the pandemic, began to push against the restrictions imposed by Covid-19 and sales began to take place.

In June sales flourished. There were 8,701 reported sales in the greater Toronto area, only 1.4 percent fewer than the 8,826 sales reported last year. That is a 19 percent increase compared to the 2,961 sales achieved in April, and an 89 percent increase compared to the 4,601 reported sales in May. These numbers represent an unprecedented recovery. Most economists had predicted a much more protracted recovery, a recovery resembling the economic recovery following the collapse of the equities market in 2008.

Unlike sales, which declined in March and then recovered in June, average sales prices did not noticeably decline during this period. In fact, they continued to strengthen, approaching record levels. In June the average sale price for all properties sold in the greater Toronto area come in at an eye-popping $930,869, 12 percent higher than last year’s average sale price of $831,882. In the City of Toronto, the average sale price came in at $1,022,138. Not quite a record but approaching one, and well above Canada Mortgage and Housing Corporation’s $1 Million threshold for high ratio loans. Housing in the City of Toronto experienced increases in all housing types – detached (14.3 percent), semi-detached (an amazing 22 percent), and condominium apartments (5.6 percent) compared to the same month last year.

These increases were stimulated by the resurgence of the high-end market, which was slower in its recovery than lower price-point properties. In June 365 properties with a sale price of $2 Million or more were reported sold. This represents a 42 percent increase compared to the 257 reported sold in this price category last year. It is worth noting that at the market’s lowest point in April, only 67 properties were reported sold in this category. No doubt with the recovery of equity markets over this period, confidence at the higher price points has returned.

Semi-detached properties throughout the City of Toronto were the most sought-after housing type. They were literally flying off the shelf. The average sale price for semi-detached properties came in at a record $1,287,832. Not only was the average sale price a record, but all semi-detached properties sold, in another record, in only 9 days. Not only did they sell in 9 days, but they sold for 106 percent of the asking price. In Toronto’s eastern districts, all semi-detached properties sold, in a record 6 days, for 110 percent of their asking price. In the trading areas closest to Toronto’s central core (Riverdale, Leslieville, the Beaches) in 5 days and for more than 110 percent of asking price. These are extraordinary numbers and an unprecedented market performance.

The one area of continuing concern is supply, although there was some marginal improvement in June. In June 16,153 new properties came to market. A slight increase compared to the 15,824 that came to market last year. Unfortunately, at month-end, there were only 14,001 properties available for buyers throughout the greater Toronto area, almost 30 percent fewer than the 19,655 that were available last year.

Early indications point to an equally strong July. The factors that drove the market in June are still present and will not be going away – historically low-interest rates, pent up demand, and lack of supply which is creating a “don’t want to miss out” mentality amongst buyers.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

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

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

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

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

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

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

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

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

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

The Toronto and area resale market performed as expected in April. As reported in our March report, the implementation of the emergency lockdown measures had a crushing impact on the resale housing market. With most businesses closed and more than three million Canadians unemployed there was no reason to believe that the resale market would miraculously revive in April.

Sales dropped precipitously, declining by an unprecedented 67 percent compared to April 2019, to only 2,975 this year. Although, the decline is shocking, viewed from a different perspective it is amazing that the decline wasn’t worse. With businesses, restaurants and bars closed, with people being ordered to stay home by governments and health authorities, and with industry-wide restrictions on accessing properties, 2,975 reported sales are a testament to the strength and resilience of the Toronto resale market.

Two other aspects of the Toronto and area resale market also demonstrate its strength and resilience. Notwithstanding the sharp decline in sales, sale prices held firm in April. The average sale price came in at $821,392, slightly higher than the average sale price of $820,373 recorded last year. In the City of Toronto (416 trading districts) the average sale price came in at $881,424. The pre-March 15th average sale price for properties sold in the greater Toronto area was around $900,000, and somewhat higher for properties sold in the City of Toronto.

In addition to average sale prices holding firm, all properties sold in April spent only 19 days on the market, the exact number of days that properties spent on the market last April. Depending on housing type and location, the market was even faster. For example, semi-detached properties sold, on average, in only 13 days throughout the greater Toronto area, in 12 days in the City of Toronto, and in only 10 days in Toronto’s eastern districts. Most of these semi-detached properties sold for more than their asking price.

Condominium apartments also sold very quickly, averaging only 18 days on market, including condominium apartment sales in Toronto’s central districts where almost 50 percent of all condominium apartment sales take place. Sale prices of condominium apartments in the City of Toronto were off by 4 percent compared to last April, no doubt a reflection of job losses affecting first-time buyers.

The more expensive end of the resale market was dramatically impacted by the emergency lockdown measures. Last year, 250 properties having a sale price of $2 Million or more were reported sold in April. This year that number fell to only 67, a decline of more than 73 percent. No doubt the dramatic decline of equity markets influenced buyers and sellers in this price category. By month-end, there was greater activity in property sales of $2 Million or more which can be expected to continue into May.

The emergency lockdown measures had an immediate, and not surprising impact on supply. In April, only 6,174 new properties came to market, a 64 percent decline compared to the 17,213 that came to the market last year. At month end there were only 10,561 properties available for sale. Even prior to the impact of Covid-19 the Toronto and area resale market suffered from a chronic shortage of inventory. That situation has now been further exacerbated. Since many potential buyers are no longer in the market, the decline in inventory will not be immediately felt, but as businesses begin to open, and people get back to work and back into the market place, the already strained Toronto market place will become nightmarish for buyers.

Looking towards May we can anticipate a resale market not that dissimilar to April’s, but with modest improvement. Some of the provincial lockdown measures will be relaxed in May, with some businesses re-opening and many people returning to work. These changes are not likely to immediately impact the residential resale market. During the initial changes, people will proceed cautiously in the new normal, with a stronger resale market not expected until June.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate Agents

Until the Ontario Provincial Government declared a state of emergency, the Toronto and area residential resale market was on course to produce one of the strongest, most robust markets on record, including the establishment of a record-breaking monthly average sale price. All that changed around the middle of the month as people began following provincial health authorities directives: stay home, maintain social distancing, no large gatherings, and of course, wash your hands frequently. When many of Ontario’s businesses were ordered closed, the real estate market didn’t stop but stalled dramatically.

Even with the collapse of the resale market in the second half of the month, March’s results were still substantially stronger than March 2019. This March, 8,012 residential properties were reported sold by Toronto and area realtors, a 12.3 percent increase compared to the 7,132 sales reported last year. Similarly, the average sale price for March came in at $902,680, almost matching April 2017’s record of $920,000. By comparison last March the average sale price came in at $788,133, 14.5 percent less than March 2020. What makes these numbers even more remarkable, is that all the properties that were reported sold took only 13 days (on average) to go from listing to sale.

What is so disappointing, particularly for buyers, is that March appeared to be the first month in sometime when more much-needed listings would come to market. Even with the abrupt halt in the market after March 15th, 14,424 properties came to market, a 3 percent increase compared to the 14,004 that came to market last year. In the second half of the month, listings were being cancelled, suspended or moved from the multiple listing service to exclusive listings. By the end of the month, buyers were reluctant to visit properties as open houses became outlawed and real estate brokerages established rigid showing protocols. In order to protect the health and safety of its clients, agents, staff and the greater community, Chestnut Park put into place rigid showing restrictions, only allowing the showing of properties in emergency or exceptional circumstances.

But at the end of the day, March can be differentiated as the pre-COVID-19 and the post-COVID-19 markets. Effectively the date that demarcates these two markets is March 15. Here is what happened in those two markets.

  1. During the first 15 days of March 4,643 properties were reported sold. This represented an eye-popping 58 percent increase compared to the number of sales recorded for the same period last March.
  2. In the last half of the month 3,369 property sales were reported. This is a decrease of 15.9 percent compared to the same period last year. No doubt this is the most dramatic market change in the history of the Toronto and area resale market.
  3. The average sale price for the entire month of March came in at $902,680. During the second half of the month the average sale price for all properties reported sold was only $862,563. During the first half of the month the average sale price was well over $1,000,000.
  4. Even with the almost instantaneous change in market conditions after March 15, the average sale price for the city of Toronto still came in at $987,787, and that number included the reported sale of 1,402 condominium apartments which represented more than 50 percent of all reported sales in Toronto.
  5. The average sale price for condominium apartments came in at $712,746 (city of Toronto) and average sale prices for condominium apartments in Toronto’s central core came in at $789,250. There is little doubt that without the abrupt change in Toronto’s condominium apartment market place, we would have witnessed a $800,000 plus average sale price for condominium apartments in Toronto’s central core.

So what does all this data tell us? Firstly, March’s numbers clearly indicate how strong the Toronto and area residential resale market is today. Even with everything that transpired, sales and average sale prices were still substantially stronger than March of 2019. The data also indicates that when we have dealt with COVID-19 the market should rebound exponentially. We can only hope that we have enough available properties to meet the pent up demand.

Secondly, the numbers for the second half of March point to a dismal April market. The slide that began after March 15 can not only be expected for April, but will likely be even more pronounced, given that we will only be hitting the virus’ peak late in the month.

Please, everyone, stay safe and follow the directions of the Province’s health authorities.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

It is not surprising that February was one of the strongest and most robust resale months since April 2017. What is surprising is that the market unfolded in a landscape of low resale housing supply and record-breaking average sales prices.

February saw 7,256 properties reported sold, almost 2,000 of which were condominium apartments. This is a stunning improvement compared to the same month last year, when only 4,982 properties were reported sold, an increase of more than 45 percent. February’s sales numbers exceeded those of March (normally a strong seasonal month) of last year when 7,132 properties were reported sold in the greater Toronto area.

Given the resale results, it is also not surprising that the average sale price spiked dramatically. Last February the monthly average sale price came in at $779,791. This year it jumped by an eye-popping increase of over 16 percent to $910,290. This number is very close to the all-time monthly high average sale price of $920,000 achieved in April 2017. In the City of Toronto (416 districts) the numbers were even more startling with detached properties coming in at $1,485,304, semi-detached at $1,208,073, and condominium apartments at $722,675. For the very first time, the average sale price for condominium apartments in Toronto’s central districts broke $800,000 coming in at $805,982, a 16 percent increase compared to last February’s average sale price of $694,000.

The higher-end of the market has also been improving, now catching up to the overall market. In February 266 properties having a sale price of $2 million or more were reported sold. This compares very favourably with the 193 properties sold in this category last year, an increase of over 16 percent.

Supply and affordability are becoming the resale market red flags. In February 10,613 new properties came to market in the greater Toronto area. These properties were a welcome improvement compared to the 9,834 that came to market in February of last year. Unfortunately, the slight increase (8 percent) did nothing to improve the supply of active listings at month-end. Some of the new listings were relistings of properties that had previously not sold, and the 7,256 reported sales absorbed the bulk of the real new listings that came to market. As a result, at month-end there were only 8,816 properties available to buyers, 34 percent less than the 13,284 available last year.

The supply problem for some housing types has now become disastrous. For example, in the City of Toronto, 189 semi-detached properties were reported sold in February. At month-end, there were only 137 semi-detached active listings, less than one month’s supply. In Toronto’s eastern districts 64 semi-detached properties were reported sold, yet at month-end, there were only 37 available for sale. It is not surprising, yet still startling, that all semi-detached properties in Toronto’s eastern districts sold for 118 percent of their asking price, and in only 7 days! These are incredible, yet real numbers.

At month-end there were only 885 condominium apartments for sale in Toronto’s central districts. Those represent almost 70 percent of all condominium apartments for sale in the City of Toronto. This amounts to only one month of supply. All condominium apartments sold in just 18 days and for sale prices of 102 percent of their asking price. It’s ironic that only a few years ago economists were writing that Toronto’s condominium market was overbuilt.

Looking forward we can expect similar resale market results in March, although the lack of supply may result in constrained sale numbers. The City of Toronto finds itself with only 1.6 months of supply, a historically low number. The recent Bank of Canada’s interest rate reduction will act as a further stimulus to the already supercharged Toronto and area resale market place. We will be running out of superlatives to describe the phenomenon that has become the Toronto resale market place. Don’t be surprised if March produces a record-high monthly average sale price for properties reported sold in the Toronto and area market place.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

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Toronto Real Estate

A new decade, but little change in Toronto’s residential resale market. As anticipated in my December Market Report, January came in strong with 4,581 sales in the greater Toronto area. This was a stunning 15.4 percent increase compared to the 3,968 sales reported for January last year. Enthusiasm should be slightly muted, given the fact that last year’s results were low by historical standards. For example, in 2016 more than 4,600 properties were reported sold, a number that jumped to 5,188 in 2017.

Not surprisingly average sale prices also advanced in January, but as in the case of sales, far from record levels. In January the average sale price came in at $839,363, more than 12 percent higher compared to last year’s average sale price of $747,175. The average sale price for all property sales in the City of Toronto (416 region) came in higher at $884,385. The highest monthly average sale price recorded for the Toronto and area market place was $920,000 in April of 2017.

January’s rising numbers become a little unnerving when considered against the back drop of available inventory. Only 7,836 new listings came to market in January, a decline of more than 17 percent compared to the 9,458 that came to market in 2019. Due to the large number of sales and the paucity of new listings, buyers enter February with only 11,962 available properties, more than 35 percent fewer properties than were available last year at this time. This will no doubt put upward pressure on prices, but with wages increasing by only 3.5 percent and mortgage stress testing in effect, there are limits as to how far buyers can stretch, particularly if interest rates stay stable or rise.

2020 maybe the year during which higher priced residential properties see an increase in sales. Higher priced properties have statistically lagged behind the resurgence of the overall market. For example, in January 2018 only 76 properties having a sale price of $2 Million or more were reported sold. Last year that number increased to 90. This year 130 properties were reported sold in this price category, an increase of 44 percent compared to January 2019. It is interesting to note that the number of condominium apartments in this price point is also increasing. In January, 13 (or 10 percent) of the 130 properties that sold having a sale price of $2 Million or more were condominium apartments. Last year there were only 6.

In the broader condominium apartment market supply is becoming a serious concern, as is the rise in average sale prices, particularly in the City of Toronto. At the end of January there were only 1,779 condominium apartments for sale throughout the greater Toronto area. In the City of Toronto there were only 1,246. These numbers represent a 33 percent decline compared to the number of condominium apartments available for sale last year at this time. Based on the number of sales registered in January, these numbers translate into 1.3 and 1.35 months of inventory, historic lows.

It is not surprising that condominium apartment sale prices have soared. In January, the average sale price for condominium apartments in the greater Toronto area came in at $630,000. In the City of Toronto the number was 8 percent higher at $679,000. In Toronto’s central districts, were almost 65 percent of all condominium apartment sales are recorded, the average sale price came in at $758,000, 12 percent higher than the Toronto market as a whole. It is also not surprising that all condominium apartment sales, both in the greater Toronto and City of Toronto market places, took place at 101 percent of their asking price.

The rise in condominium apartment sale prices has had a spillover effect on semi-detached property sales. Over the last year the spread between the average sale price of a condominium apartment and a semi-detached property, particularly in Toronto’s central districts has been dramatically narrowed. In January the average sale price for semi-detached properties was $1,000,000, only 24 percent higher than the average sale price of condominium apartments in the City of Toronto’s central districts. As a result of this declining spread, buyers who might have chosen to buy a condominium apartment have instead looked to purchase a semi-detached property in some of Toronto’s more desirable eastern and western trading areas. This has, in turn, resulted in an unprecedented shortage of available semi-detached properties. In January, there were, shockingly, only 92 semi-detached properties in the entire City of Toronto available for sale. In January there were 91 sales. Effectively every semi-detached property that becomes available for sale will be sold before the end of the month. And again, not surprisingly, for 107 percent of the asking price in Toronto’s eastern trading areas, and 104 percent in the western trading areas.

January’s residential resale date makes it abundantly clear that the Toronto and area market pace is strong and robust. What is also clear is that demand far exceeds supply. Unless sellers decide to take advantage of rising resale prices, 2020 will be remembered as the year of buyer frustration. There is no doubt that unless supply can be increased, like other international “supercities”, buyers will begin to look to second-tier cities around Toronto to satisfy their housing needs.

Prepared by Chris Kapches, LLB, President and CEO, Broker, Chestnut Park® Real Estate Limited, Brokerage.

Have questions about the market or selling or buying?

Contact me any time. I’m happy to answer any questions you may have.

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