Greater Toronto Area / GTA, Ontario - Tuesday June 3, 2020 – MarketWatch, the Toronto Regional Real Estate Board’s monthly statistical report [which was widely anticipated given the current situation and the statistical reports of the past couple of months in particular] was released today showing a very strong rebound in residential MLS® market activity reported by Toronto & GTA  Realtors® in June. Unless otherwise noted, all figures herein are year-over-year comparisons due to the seasonality of the residential housing market.

 

The overall figures, which include all TRREB areas and all residence types, came in at 8,701 reported by TRREB members through the Board’s MLS® System in July, down “only” 1.4% from last July. The overall average sale price was $930,869, up 11.9% YoY. It’s also worthy to note that that average price figure was up nearly eight percent from May’s $863,599 average and sales volume was approaching double May’s total [8,701 vs 4,606]. The April overall numbers - just for the record - were 6,174 sales averaging $821,392. That is, of course, a complete “one-eighty” from the historical pattern of sales volume declining as we head into the Dog Days of Summer - only to pick up again in the Fall...usually.

 

There were 894 sales of Detached homes reported in Metro Toronto, down 10%. What’s interesting is that, in the balance of the GTA, 3,551 Detacheds were reported sold - up 10.4%. That would be due to lack of availability of inventory in The Big Smoke combined with high prices [not to mention the “2X” Land Transfer Tax]. Average sale prices were $1,523,770 in the former and $1,027,634 in the latter.

 

By the way...just in case you’re wondering...Detacheds in Toronto averaged $1,578,542 on 1,268 sales in April of 2017. In the balance of the GTA those numbers were $1,098,827 & 4,447. Are we looking at new highs in the weeks and months ahead? Stay tuned…...

 

Condo Apartments have really had a rough ride with some buildings not allowing visitors onto the property. Hard to show a home to a prospective buyer when they’re not allowed on the property. Still, 1,287 changed hands in T.O., down 13.6%, averaging $672,465, up 5.6%. Go figure. The rest of the GTA saw 506 sell, a 22.3% tumble, at an average of $528,028, up 9.1%. Some speculate that more headwinds face or will face the Condo Apartment market, namely some degree of reluctance to share common spaces [including elevators] with a pandemic still very front-of-mind for many as well as the lack of AirBnB business which may force some small-time landlords/investors to unload their properties. There’s also still a good number of and unbuilt units coming to market.

 

 

Well, you really don’t have to look any further than the increase in the average sale price year-over-year combined with the inventory numbers to figure out that inventory - a long-standing problem - continues very much to be such. We’re not sure about the need for massive increases in new developments in and around Toronto and the GTA. This is probably more an issue of people sitting tight for any number of reasons as opposed to a “housing shortage”. Markets usually figure these things out on their own. A world-wide pandemic, of course, isn’t helping to alleviate the long-standing inventory issue.

 

Total Active Listings were down 28.8% YoY to 14,001 homes available for sale. Based on the month’s sales total, that gives us an “Indicated Forward Inventory” of just 1.6 months. Not quite as “tight” as the Spring of ‘17, but very snug by historical standards nonetheless.

 

The absorption rate - the rate at which the market’s “absorbing” newly listed properties in the form of completed sales - stood at .534 and it should be noted that new listings on the month [16,153] were actually higher than the Total Active Listings [14,001]... yet another indicator of just how fast things are moving out there.

 

And - speaking of fast-moving - Bungalows nearly everywhere in the area are a very hot commodity. One we sold at Bloor & Islington drew 4 written offers, had a few more communicated “verbally”, and sold in 4 days for over 120% of asking. Average Bungalow prices and other relevant “Bungalow-specific” statistics for the entire area can be found on the QuickStats page.

 

 

“Following the broader movement to reopen the economy in June, we experienced a very positive result in terms of home sales and selling prices. Before the onset of COVID-19, there was a great deal of pent-up demand in the market. This pent-up demand arguably increased further over the past three months. We are still in the early days of recovery, but barring any setbacks, we should continue to see stronger market conditions in the second half of 2020 as households look to satisfy their ownership housing needs” said board President Lisa Patel in the report.

 

Jason Mercer, the Board’s Director of Market Analysis: “A gradually improving labour market and historically low mortgage rates are expected to support a recovery in home sales in the second half of 2020 along with sustained year-over-year price growth. Given that home sales result in substantial spin-off expenditure in the regional economy, the housing market will be an important driver of overall economic recovery this year and into 2021.”

 

In order to further gauge the impact of COVID-19 on the GTA housing market and to gain insight on what the future holds for housing demand and supply, TRREB undertook a second wave of consumer polling through Ipsos between May 25 and May 31 2020. Key findings include:

• In line with the Ipsos polling results for April, 27 per cent of respondents said they were likely (very likely or somewhat likely) to purchase a home over the next 12 months. This result was below the spring 2019 result of 31 per cent, but given the credibility interval of +/- 3.9 percentage points, the result remained in line with past polling results. 

• Listing intentions, while up from the April Ipsos poll (21 per cent in May versus 17 per cent in April), the result remained well-below the 32 per cent listings intentions mark recorded in the spring of 2019.

 

Homes sold “13.3% faster” at 26 days on the market versus 30 last July.

Thanks for stopping by and, again, #StaySafe - all the very best to "You & Yours"!
 

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