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Toronto Real Estate Agents

Market reports rely heavily on comparisons to the same month the year before. Comparing April 2021 to April 2020 would be pointless. Last April we were in the darkest period of the Pandemic. Buyers, sellers, and their realtors were developing and adapting to new, restrictive, and demanding industry protocols. As a result, there were fewer properties available for sale and even fewer sales. As a result, it is much more fruitful to look at what unfolded just this past March and compare it to April’s market performance.

March 2021 was an all-time record breaking month both for the number of properties reported sold and the average sale price. April 2021 could not keep pace with the torrid March market. Having said that, April was itself record breaking, setting a new record for reported sales for any previous April. There were 13,663 homes reported sold, 12 percent fewer than the blistering 15,652 that were sold in March. There was also a marginal decline in the average sale price. March’s average sale price came in at $1,097,565. Although still eye-popping, April’s average sale price dipped to $1,090,992.

The decline in price was across the board for all housing types, except condominium apartments. Detached, semi- detached, and townhouse property prices all declined, albeit marginally. In April the average price for detached properties came in at $1,699,756 (a 3 percent decline from March), semi-detached at $1,288,005 (a 1.5 percent decline), and townhouses at $942,371 (a 2 percent decline).

The outlier was condominium apartment sale prices. In April 3,290 condominium apartment sales were recorded, a considerable decline from the 3,821 reported sold in March, a decline of almost 14 percent, contributing substantially to the overall decline in market sales as compared to March. However, while sales declined, prices increased, both in the City of Toronto and the 905 region. The average sale price for City of Toronto condominium apartments came in at $727,137, up from the $707,835 achieved in March. In Toronto’s central districts, where most of the greater Toronto’s condominium apartments are located, the average sale price came in at $781,471, a number not far off average sales prices for condominium apartments pre the Pandemic.

So, what does all this data tell us about the Toronto and area marketplace? Firstly, it was impossible that March’s pace could be exceeded or even equaled for a second month in a row. Since the beginning of 2021, 47,157 properties in the greater Toronto area have changed hands. Historically this is an unprecedent pace. What April’s data tells us is there has been tremendous buyer absorption during the last few months of 2020 and now into the first four months of 2021. Bluntly, the market is running out of buyers. With no immigration since last March, and with many city dwellers moving to secondary markets during the Pandemic, the number of potential buyers is declining.

As to the average sale price, it appears that it too may have reached a pinnacle in March. Between 2019 and March 2021, average sale prices have increased by more than 20 percent. Household incomes have not. A recent study indicated that the decline in mortgage interest rates over the same period has boosted the price that buyers could pay for properties by 22 percent. It is not coincidental therefore that average sale prices have increased by more than 20 percent over the same period.

Subject to an increase in migration to the Toronto area from other parts of the country and a return to pre-Pandemic immigration levels, the market has probably plateaued and in fact we may see a slight decline in sales as we make our way to the latter half of 2021. Similarly, unless there are declines in mortgage interest rates, the average sale price has plateaued at approximately $1,100,000. Looming on the horizon is the more restrictive mortgage stress testing effective June 1, 2021, which will place further restrictions on buyers’ borrowing power.

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

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Toronto Real Estate Agents

Just when you think the Toronto residential resale market can’t reach new heights, it surprises us again. March was not only strong but it shattered records, something that is becoming a common occurrence.

In March 15,652 homes were reported sold, an all-time monthly record and 97 percent more than the 7,945 properties sold last March. Even considering that the second half of March 2020 was impacted by the implementation of Covid restrictions, March’s results are nothing but extraordinary.

Not only was sales volume record-shattering, but so was the average price. The average price for Toronto and area came in at an eye-popping $1,097,585, the highest average sale price ever recorded. This number is even more impressive when it’s remembered that it included the sale of almost 4,000 condominium apartment units, the least expensive homes on the market, averaging less than $700,000.

The average sale price was unequivocally driven by the unbelievable number of high-end properties that were reported sold. In March 982 properties having a sale price of $2 Million or more changed hands – also a record! By comparison, only 245 sold in this category last year, obviously a number dampened by the effects of the pandemic’s restrictions during the last half of the month.

The speed at which properties sold was also record-breaking. All 15,652 properties reported sold in March came to market and were sold in only 13 days. There are no market descriptors that can define this phenomenon. At one time it was the eastern trading districts in Toronto, in particular Riverdale, Leslieville, and the Beaches, that had speed of light sales. Now sales are taking place even in the 905 region at an incredible pace.

Not only are properties selling quickly in the 905 region, but they also account for the bulk of all reported sales. Of the 15,652 sales in March, 10,522 of them took place in the 905 region, representing 67 percent of all reported sales.

In March condominium apartment sales continued a resurgence that began at the end of 2020. Condominium apartment sales increased by 87 percent in the City of Toronto and by 100 percent in the 905 region compared to last year. Although average sale prices increased in the 905 region by 13.5 percent to $607,000, they remained flat in the City of Toronto at $707,000.

March had a bright spot for stretched and frustrated buyers. In March 22,709 properties came to market, a much-needed increase in inventory, and 57 percent more than March of last year. It would appear that sellers are becoming eager to capitalize on the incredible prices that were achieved this month.

This runaway market gives rise to a variety of issues. There is the issue of sustainability. The average sale price reached a lofty $1,097,565 in March, almost $200,000 higher than it was a year ago. Average household income has not increased proportionately. Far from it. Even more worrisome, at the date of preparation of this Report, (April 8th), the average sale price in the City of Toronto was even higher at $1,106,000, including condominium apartment sales.

When the sustainability of the housing market becomes an issue, it generates government scrutiny. Government intervention inevitably leads to unwanted consequences, as past government intervention has clearly demonstrated. So there is talk of a capital gains tax on principal residences and even a speculation tax. The best solution is an organic one – namely the market moderates itself because households become incapable of paying higher prices, and more inventory comes to market. We are beginning to see signs of both of these developments. 

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

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Toronto Real Estate Agents

Is it really February? The Toronto and area residential resale market certainly did not behave as if it was. Actually, it was more reminiscent of a crazy spring market, and even then, it outdistanced most spring markets that we have recently experienced. In February 2021, 10,970 properties were reported sold in the greater Toronto area. To put that number into perspective, no month in 2019 came close to 10,970 sales. The strongest month for sales in 2019 was May at only 9,951 reported sales, and that was an excellent month! By comparison to February 2020, also a strong month at 7,193 sales, February 2020’s performance was 52.5 percent stronger.

It will surprise no one with such robust sales activity that prices were also sharply on the rise in February. In fact, the average sale price for the greater Toronto area shattered the $1 Million threshold for the first time, finishing the month at $1,045,488, almost 15 percent higher than the average sale price of $910,142 achieved last year. It is interesting to note that the average sale price for the City of Toronto came in lower at $995,201. That was due to the 2,167 condominium apartment sales that were recorded. These lower price point properties acted as a drag on the City of Toronto average sale prices.

Detached and semi-detached property sales in the City of Toronto were extremely active and at a strong prices. Expect to pay almost $1.7 Million for a detached property and $1.325 Million for a semi-detached home – if you can find one. The supply of detached and semi-detached properties in Toronto is at an all-time low. In February, 915 detached properties were reported sold. By March, the inventory of detached properties was down to 938 homes or only 1 month of supply. The supply of semi-detached properties has reached a critical state. In February, 295 properties sold in this category. By the beginning of March, only 181 semi-detached properties were on the market, only .6 months of supply – an unprecedented number.

Sales of every housing type, including condominiums, were strong. This was particularly true for higher-priced properties. In February, 597 properties having a sale price of $2 Million or more were reported sold. Comparisons to previous years are staggering. In 2020 only 266 properties in this price category were sold, and in 2019 a mere 193. Sales in February 2021 were a shocking 125 percent higher than sales at this price point in 2020.

Condominium apartment sales were also very strong in February, posting results 63.2 percent higher than last year. While sales increased, the average sale price continued to decline by 6.4 percent in Toronto but rising by 5.4 percent in the 905 region. It is the decline that is relevant in that 70 percent of all condominium apartment sales are in the City of Toronto. The decline in average sale price in the City’s core, where most sales are recorded, was even lower, down by 10 percent compared to last year.

February’s resale market was like no other we have experienced. Going forward we can anticipate more of this, at least until March and into April, however sustaining 15 percent price increases (higher in some districts) will be difficult. Even with historically low mortgage interest rates, affordability will become (is?) a concern. On the positive side, February saw new inventory increase by over 40 percent compared to last year. If the pace of new listings coming to market continues, more consumer choice should see prices begin to moderate. But currently, with only 1.5 months of inventory, price moderation is still some months away.

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

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Toronto Real Estate Agents

Once again, the Toronto and area resale market delivered eye-popping results. As compared to last January sales were up by over 52 percent and the average sale price increased by almost 16 percent. In absolute numbers January produced an unprecedented 6,928 sales – there were only 4,546 last year – and the average sale price came in at $967,885 for all properties sold throughout the greater Toronto area. It was only $838,000 last year.

But the market was not homogenous. Within the City of Toronto, sales were dominated by condominium apartments. Over 55 percent (1,703 apartments) of all reported sales were condominiums. That was a shocking 85 percent increase compared to the number of condominium apartments sold last year. In the last two months, condominium apartment sales in the City of Toronto have come roaring back erasing the mid-pandemic declines they had experienced.

That was only part of the story. While sales were soaring, average sale prices continued to decline. By month-end, condominium apartment prices in Toronto’s 416 region had declined by 8 percent. The situation was more extreme in Toronto’s central core. Almost 70 percent of all Toronto condominium apartment sales are located in Toronto’s central districts, primarily downtown. Last year the average sale price for condominiums in Toronto’s central districts was $758,000. In January, the identical apartments were selling for $661,000, 13 percent less. With such steep price reductions, it is not surprising that buyers are flocking to the condominium apartment market.

The other market story is Toronto’s suburbs, the 905 region. Not only are more sales taking place in the region, but at rapidly rising prices. In January the average sale price in the 905 region was more than 10 percent higher than the average sale price in the City of Toronto ($866,331). Halton (Burlington, Halton Hills, Milton, and Oakville) and York Region (Aurora, East Gwillimbury, Georgina, King, Markham, Newmarket, Richmond Hill, Vaughan, and Whitchurch-Stouffville) both produced average sale prices for all properties reported sold of more than $1,160,000.

Higher priced properties throughout the greater Toronto area sold at a pace not seen before for January. In January 331 properties were reported sold having a sale price of $2 million or more. That amounts to a shocking 155 percent increase compared to the 130 properties that sold in this category in 2020, and only 76 in 2019. This is an amazing accomplishment, and it demonstrates that robust sales of properties in the greater Toronto area are taking place in all price categories.

Aside from the issue of sustainability, the perennial concern, as we move into February, inventory levels remain a problem. At the end of January, there were only 7,396 properties available to buyers, almost 5 percent fewer than last year. The bulk of those listings (44 percent) are condominium apartments. There simply aren’t enough ground level, freehold properties to meet demand. It is the rarest of occurrences when new listing offerings aren’t greeted by multiple offers – many multiple offers.

Looking forward, February will be an even stronger month than January. Early February data indicates that the resale market will exceed last February’s results by at least 50 percent and that the average sale price, both in the City of Toronto and the surrounding 905 region, is on an upward trajectory. Cheap money – five year mortgage interest rates at less than 2 percent & Government stimulus, and the consumers’ frantic psychological need to acquire real estate, preferable low rise, with outdoor space, will continue to drive this frenzied market for the foreseeable future.

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

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December’s Toronto and area residential marketplace exhausted all the superlatives that we would normally apply to a robust resale market. Not only was December’s housing market strong by historical standards, but it dramatically exceeded historic norms, performing more like a spring market than what we have come to expect of property sales during the holiday season. It’s almost as if the holiday season didn’t exist, and unfortunately, because of the restrictions imposed by the effects of Covid-19, normal retail shopping was non-existent. Deprived of retail shopping, it appears that buyers focused their attention on housing instead.

December saw 7,180 residential properties reported sold. That is an eye-popping 65 percent increase compared to the 4,364 properties reported sold last December. December 2019 was a very strong month. For example, only 3,746 properties were reported sold during December 2018. It’s not surprising that with this surge of sales, we also witnessed a surge in the average sale price. On a year-over-year basis, the average sale price for all properties sold in the greater Toronto area increased by more than 11 percent, from $838,662 last year to $932,222 this December.

No doubt this huge jump in average sale price was driven by the number of higher-priced properties that changed hands in December, normally a quiet month for luxury property transactions. In December, 287 properties having a sale price of $2 million or more were reported sold. That compares with only 125 last year, an increase of 130 percent. Not surprisingly more than 90 percent of those properties were detached single-family homes in the 416 and 905 regions.

December’s condominium apartment sales require extra attention. Both during the third and forth quarters of 2020 condominium apartment sales and prices declined, in some cases substantially, namely in Toronto’s central core, while inventory levels increased dramatically. In December, we saw a stunning resurgence of condominium apartment sales. In Toronto’s 416 region, sales increased by 80 percent compared to December 2019. In the 905 region condominium apartment sales were equally as strong, increasing by 75 percent. In the 416 region, there was no corresponding increase in average sale prices. In fact, quite the opposite: average sale prices declined by 5 percent. In Toronto’s central core, where most of the City’s apartment projects are located the decline was even steeper. Prices fell by almost 10 percent, from $733,000 in December 2019 to $669,000 this year. Central core condominium apartment sales accounted for almost 67 percent of the city of Toronto’s total condominium apartment sales. It should be noted that condominium apartment sales in the city’s eastern districts not only doubled, but average sale prices actually increased from $476,000 last year to $512,000, bucking the trend in the central core.

The increase in condominium apartment sales at lower average sale prices shifted the variance between average sale prices overall between the 416 and 905 regions. Before December the average sale price in the 905 was always less than the 416. Not this year. The average sale price for the greater Toronto area came in at $932,000. It was 4 percent less in the city of Toronto ($894,000), all as a result of the massive increase of condominium apartment sales at sharply falling prices.

It will be interesting to see if December’s condominium apartment sales were a market anomaly. It may be that the more affordable prices have overcome buyer’s need for space and safety. This phenomenon might also be driven by the fact that prices in the 905 region have risen to prohibitive levels.

Having said that sales of ground level properties, detached, semi-detached and townhouses were robust both in the 416 and 905 regions. Price increases in the 905 eclipsed price increases achieved in the 416 region. Interestingly even condominium apartment average sale prices increased by over 6 percent in the 905 region, a stark contrast to what we witnessed in Toronto’s central core.

Overall, more than 95,000 properties were reported sold in 2020, a 9 percent increase compared to the 87,751 properties reported sold last year. Notwithstanding the unprecedented socio-economic upheaval experienced universally in 2020 as a result of the pandemic, the Toronto and area resale market results were the third best on record. An extraordinary accomplishment!

Looking at 2021 the economic factors that drove the 2020 housing market remain in place. The key factors are exceptionally low mortgage interest rates, government stimulus, and a roaring stock market. With interest rates as low as they are, asset acquisitions will continue to drive the housing market. It is impossible to see a change in this scenario until borrowing money becomes substantially more expensive than what it is at the beginning of 2021.

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

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

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

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

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

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

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

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

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

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

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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.

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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