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January 2017 Market Review

February 14th, 2017 Posted by Market Review No Comment yet

January marked a tremendous start to the 2017 Toronto real estate market. Sales volume was up 11.8% over January 2016 – which had been up 8.2% over 2015. New listings last month were down 17.6%, to 7,338, while the total number of available listings dropped 49.5%, to just 5,034 by the end of the month. That made for some intense sales pressure. Accordingly, the average selling price was up 22.3%, to $770,745 (for all housing types). That’s on top of the 14.1% price increase recorded last January. Even TREB’s HPI, which tries to smooth out the average by taking into account differences among housing types, increased 21.8%. Last January, that number was up a more moderate 10.7%.

The number of properties on the market last month was less than half what it was just two years ago: in January 2016 TREB reported 9,966 available listings; in 2015 it was 11,600. The bottom line is that the Toronto market continues to be defined by the scarcity of listings. All this while the population continued to grow….

It’s no wonder that the once-maligned condo market has firmed up – it’s doing its best to take up the slack. Condo sales in the 416 surged 26.8% last month (after increasing 11.6% last January), driving the average selling price to $471,409, up by 13.1% year-over-year (up 8.6% last January). Condos (if you can get one…) remain a good purchase, for occupying and/or as an investment.*

Although this example isn’t necessarily typical, it illustrates how dramatic the competition is currently: a house in Scarborough that sold in December and closed in January, just resold (just a couple of weeks later) for $150k more. That’s nuts. With so few houses on the market, the usual battle over homes has intensified, but I’d like to think that things will calm down a bit as the spring market generates more listings. Although we typically see more buyers at this time of year, the current – apparently desperate – mood may subside. One can hope, anyway….

Still, if you have a house to sell, let’s get it on the market ASAP!

*If your primary residence has significantly increased in value since you bought, and you have no intention of moving any time soon, you might want to consider drawing on some of that capital to buy an investment property that will both increase in value, and generate income down the road.

2016 Market Review – and a look ahead at 2017

January 17th, 2017 Posted by Market Review No Comment yet

2016 was a big year in Toronto real estate. For the second year in a row, TREB reported a record number of sales. Despite the volume of available listings shrinking, the number of sales hit 113,133 units, an 11.8% increase over 2015. The natural consequence of that is higher prices.

December was a prime example. Available listings were down 48.1%, to just 4,746 (from 9,137 in December, 2015), which TREB noted was the lowest inventory in 15 years. The number of sales reported to TREB in December was up 8.6% to 5,338 (from 4,917). Those tight market conditions drove up the average sale price 20% year-over-year, to $730,472 (from $608,714).

The average increase for the whole year was slightly lower, at 17.3%. However, the average sale price was basically the same, $729,922.

Note that the condo market, which not so long ago was reputed to be ‘over-built’ and primed to ‘crash’, has become the alternative of choice for an increasing number of buyers. Condo sales in the 416 were up 19.5% last month, with the average sale price up 16.6%. With an average sale price of $466,592 for a condo apartment, it’s easy to see why. (Condo townhouses are somewhat more expensive, at $569,864.) In fact, if anything, we may run into an ever-tightening condo market this year….

There’s no reason to expect anything different in 2017. Toronto is still a destination city, and the population keeps growing. CMHC is raising its premium on March 17th, so it will cost a bit more to buy if you can’t put 20% down (which means most first-time buyers), but that’s not likely to change overall market conditions. Mortgage rates may edge up a tiny bit, but they are super low these days and not expected to rise significantly in the next couple of years. That probably won’t be a factor in the Toronto market this year. The feds have tightened general mortgage qualification rules several times in recent years, and that does make it harder for first-time buyers, but I doubt that will affect the rate of sales and/or price increases. The bottom line is that the market is strong, and there’s no point waiting for a ‘correction’: get out there and buy.

And, yes, it’s easy to sell in this market, and harder than ever to buy. Still, more people are buying than in past years, so it’s not impossible! One has to get active, get out there and get shopping to find the right place. Don’t be put off by all the hoopla. Whatever you need, we’ll find it! 😉

Summer 2016 Market Review

September 13th, 2016 Posted by Market Review No Comment yet

I’ll admit it: sometimes, I get tired of repeating myself! The Toronto real estate market has risen so consistently – relentlessly, even – over the past few years that these monthly reports are not nearly as exciting to write as they once were.

Like last year, I’m combining July and August here. I started doing that because the summer is usually quieter than the spring and fall markets. As it happened, that wasn’t quite the case this year. I had expected July to be busy, but it exceeded expectations with 9,989 transactions – yet another monthly sales record. One wouldn’t have thought that likely given the on-going supply shortage….

Once again, while sales volume was up (1.8%), the number of new listings was down 7.4%, from 14,625 to 13,542. The total number of active listings fell from 16,673 to 11,346, a drop of 31.9%. Strong demand driving increased sales volume amidst fewer houses for sale is a recipe for frustration, isn’t it?

These market conditions caused the average sale price (across all types) to surge 16.6%, to $709,825. Note that it was below the June average of $746,546, which is typical. The market stays super tight (low supply and lots of buyers), but with a different mix of house types: fewer of the top-priced detached and semis, and a higher ratio of less expensive condos, which brings the average down.

On the topic of condos, sales in the 416 increased by a somewhat lower 9.8%, edging the average price up by just 8.2%, to $427,074.

August was even more impressive. Sales shot up 23.5% over August 2015, to a new record of 9,813 transactions. Much has been made of the point that there were two more business days in August 2016 over last August, but the fact remains that the number of active listings was down 37.7% to just 9,949 while sales continued to surge. The average sale price was up 17.7% over August 2015, to $710,410 (about the same as July, for much the same reasons).

Condo sales in the 416 jumped 33.5%, driving up the average price by 9.8%, to $446,612, which was also up over the previous month. In short, condo sales in Toronto are hot these days.

The fall market is upon us, and the number of listings seems to be increasing. That’s good for buyers, who get more selection, but also good for sellers, as the overall increase in activity correlates to higher prices. It ain’t easy navigating the Toronto real estate market, but I’m here to help. Call me any time!

June 2016 Market Review

July 7th, 2016 Posted by Market Review No Comment yet

June was a typically busy month in the Toronto real estate market. TREB’s Market Watch reported 12,794 sales for the month, up 7.5% from the 11,905 sales reported last June. I could copy and paste this from my last couple of market reviews: once again, new listings were down. There were only 16,980 last month, down 3.8% from the 17,659 new listings posted in June, 2015. The total number of active listings was down a whopping 31.4%, from 17,972 to just 12,327. Again, that’s a major source of frustration (and escalating prices) in the Toronto market: not enough listings!

The average sale price (for all types, not just the much-reported detached house) was $746,546, up 16.8% over last June’s $639,309. That’s a pretty steep hike, but not shocking given the lack of inventory.

The condo segment had a great month. Sales were up 15%, and prices edged up 6.9%, showing some strength, but again keeping condos as a great option for would-be house buyers who want to get into the market before they fall too far behind the price increases. Think about it: the sooner you buy something, the sooner you start building equity!

By the way, short supply of new listings isn’t the only reason prices continue to rise. There are other factors that affect housing prices in Toronto. Everybody knows that low interest rates (i.e. ‘cheap money’) are helping buyers; that’s a big deal, certainly. Our fantastic city’s rising population contributes a constant level of demand, too. Rarely reported is the non-stop improvements we see going into properties all across the city. Renovations and additions add value, and one doesn’t have to look far to see them happening. That house that just sold for way more than it did last year has been gutted and modernized. It makes sense that it would sell for much more, doesn’t it’?

July and August are usually a slower period – the ‘summer market’. If you are a buyer, keep your eyes open, as we may see some opportunities while other buyers are at the beach/patio/cottage! 😉

May 2016 Market Review

June 8th, 2016 Posted by Blog, Market Review No Comment yet

May was another blistering month in the Toronto real estate market. TREB reported 12,870 sales, up 10.6% over May 2015, and setting the record for that month. Once again, new listings declined, from 18,611 in May 2015 to 17,412, a drop of 6.4%. Hot sales and fewer new listings cut the total number of active listings from 18,585 last year to just 12,931, a huge drop of 30.4%.

That combination is the primary cause of the intense competition among buyers, and contributed to further price increases. The average sale price last month was $751,908, up 15.7% over $649,648 recorded last May. TREB’s HPI was up by roughly the same amount, 15%.

The 416 condo market also had a booming month. Sales increased by 21.7% year-over-year, while the average price was up a more modest 5%. There’s more selection in the condo segment, and although prices keep increasing, it’s at a much more manageable rate for first-time buyers. If you have your heart set on a house for your first purchase, you might want to consider a condo as a way to get your foot in to the real estate market….

Traditionally, the spring market goes ’til some time in June, and things definitely slow down after the July long weekend. In recent years, however, with the on-going supply shortage and teeming buyers, the summer months have remained competitive. It remains to be seen what exactly will happen this year, but I’m expecting stronger than usual activity in July, due to pent-up buying demand. I think that the key to success this summer will be to stay active!

April 2016 Market Review

May 12th, 2016 Posted by Market Review No Comment yet

April 2016 was another record setting month in Toronto real estate. TREB reported 12,085 sales for the month, up 7.4% over April 2015. Once again, new listings were down, from 18,038 last April to 16,252 this year, a drop of 9.9%. The decline in new listings, combined with the high pace of sales so far this year, caused the total number of available listings to drop from 17,182 last April to just 12,554 this year.

Obviously, competition among buyers is fierce, which drove up the average sale price by 16.2%. TREB’s HPI was up a slightly lower 12.6%, indicating that high-priced houses (e.g. large detached homes) are dragging up the average. Still, 12.6% is a significant increase.

I’m still tracking the condo segment – although the condo naysayers are much quieter these days. Condo sales in the 416 increased 17.4% last month, while the average price was up 7%. That’s much less than in the house market, which I say makes condos a decent alternative for first-time buyers. You don’t have to give up the dream of owning a house, but you may be wise to plan for a delay. Get into the market with a condo, start to build some equity, and leverage that into a house down the road. 😉

It’s a super-competitive market out there these days. You don’t need to be scared of it, but you certainly will benefit from professional help. Call me any time to talk about your real estate wants and needs, and how to go about fulfilling them.

March 2016 Market Review

April 6th, 2016 Posted by Market Review No Comment yet

March 2016 was another busy month in Toronto real estate. TREB reported 10,326 sales for the month, up 16. 2% over March 2015 sales. Net new listings declined 3.7%, to 14,864 and total active listings dropped (more…)

February 2016 Market Review

March 7th, 2016 Posted by Market Review No Comment yet

Say it with me folks: “Another record month!” Once again, both sales volume (7,621 sales, up 21.1%) and average price ($685,278, up 14.9%) in February 2016 beat not just last February, but also the previous record, set in 2010. The MLS Home Price Index (which smoothes out price changes over different housing types) was up by a slightly lower 11.3% , but that’s still a strong surge. Clearly, the market direction for this year is set: onwards and upwards!

Last month actually saw a decent increase in new listings (11,275 , up 8.2%), but the total number of available listings was down (10,902, a drop of 14.8). That kept up the pressure on buyers, causing competition in an already tight market. We’ll see more listings this month and next, but not enough to ease the pressure….

The condo segment had a particularly busy month. Sales in the 416 were up 25.6% over Feb ’15, and the average price surged 17.8% to $435,579. As I mentioned last month, condo prices are showing real strength. If you are thinking of a buy, you should get on that.

Last month my Exclusive listing at 58 Brookmount Rd sold (through another RE/MAX Hallmark agent). I have another Exclusive now at 438 Becker Rd in Richmond Hill. Check out the info and call me if you’d like to go see it, or watch for it on the MLS later this month.

January 2016 Market Review

February 4th, 2016 Posted by Market Review, Uncategorized No Comment yet

January got 2016 off to a quick start. In its monthly Market Watch, TREB has reported 4,672 sales for the month, up 8.2% over January 2015. At a time of constrained supply – both generally, over the last few years, and seasonally – prices shot up 14.1% year-over-year, to $631,092. That was apparently due, at least in part, to more sales of pricier houses outside the GTA. By comparison, TREB’s HPI, which tries to smooth out the average by accounting for type of houses sold, was up a more modest – but still significant – 11.2%.

To illustrate the point about supply, there were just 9,966 active listings last month, compared to 11,600 in Jan.15. That’s a drop of 14.1%. Ten years ago, in January 2006, there were 18,073 active listings (a 3% increase from January 2005), and 4,587 sales (a 10% year-over-year increase). That’s almost double the current supply, and there were fewer sales! It’s no wonder that buyers today are feeling the pressure….

In the condo segment, sales volume in the 416 increased 11.6% over Jan.15 and prices jumped an interesting 8.6%. I say that because we’ve seen decent sales volume in condos over the last year or so, but usually not the same kind of price increases that houses have shown. It will be interesting to see if this keeps up….

In general, I think that the ‘spring market’ will get going sooner rather than later. If you are a buyer, keep your eyes peeled and when we spot something, be ready to pounce! If you are planning to sell in the first half of this year, you should get to work on/around the house ASAP; it’s better to be ready early!

By the way, my Exclusive listing at 58 Brookmount Rd will hit the MLS on Feb 16th. Call me if you would like to see it before then.

 

 

December 2015 Market Review

January 6th, 2016 Posted by Market Review No Comment yet

A strong December sales pace capped a record-setting sales year in the Toronto real estate market. With 4,945 sales reported to TREB last month (up 11.9% over the 4,418 reported for December 2014), the total for the year hit 101,299 – 9.2% more than 2014, and breaking the 100,000 mark for the first time.

New listings for the month actually increased to 4,783, up 8.4% over 4,413 in December 2014. However, total available listings declined. Continued low supply meant continued competition among buyers, which again pushed prices up. The average sale was $609,110, up 9.5% over December 2014, and pushed the average price for the whole year to 622,217, up 9.8% over the 2014 year-long average. (TREB’s HPI increased by 10% year-over-year, which would generally indicate strong demand for all housing types.)

Condo sales in the 416 also showed strength, increasing 12.5% over December 2014. Perhaps due to better supply (compared to low-rise housing), perhaps simply due to the distribution of sales, average price increased only 3.2%, keeping condo pricing ($400,088 in the 416 and just $325,036 in the 905) well within range for first-timers.

January is just getting started, but based on my client list and conversations with other agents it sounds like we are in for another busy year. The ongoing shortage of new listings has created a near-constant state of pent-up demand – i.e. there are buyers out there, and they are looking to buy ASAP. That means we’ll see competition among serious buyers and upward pressure on prices through 2016.

Plus, interest rates are low and may even go lower this year, as the BoC tries to stimulate the economy, so buying power will remain at historic highs. That provides some relief to buyers trying to keep up with the price increases, but it won’t last forever… we think! It’ll last a couple more years, though, so that will continue to be a feature of the real estate landscape for the foreseeable future.

One last thing: mortgage approvals. The rules on that are tightening up again. If you are a buyer (or need to renew an existing mortgage) make sure that you have a fulsome conversation with your mortgage professional BEFORE you go out shopping for a house. Nobody needs a nasty pre-approval fail to ruin their purchase plans. 🙂