WHAT IS HAPPENING IN TORONTO’S REAL ESTATE MARKET???
January 25, 2021
Let’s start out with what’s happening right now and then we can talk about the crazy numbers we saw in December.
Realtors were holding our collective breath when the province was announcing new restrictions, but the new ‘stay-at-home’ order doesn’t seem to be changing anything. Real estate is still deemed essential and we’re still taking the same level of precautions we were before.
The slowdown last spring was due to the (totally legitimate) fear of the unknown, but now we know what we’re dealing with. People are less afraid to leave the house now and I don’t foresee the market stalling again. The market appears to be continuing on exactly the way it has been. People who need or want to look at properties are being more discerning and are weeding homes off their list before they go on viewings. Though it means more legwork up front for the consumer, they may see one place instead of three.
The real estate market in 2021 has started with a bang. There’s far more activity than I traditionally see in January, and the lack of snow and “mild” temperatures are certainly helping.
My most recent sale was a one bedroom plus den at 330 Adelaide Street East. The original plan was to hold off until the spring market, but because of the activity we’ve been seeing in the market, we decided to push up the list date to early January.
Because of how long condos were sitting on the market in 2020, I decided to try virtual staging. Have a look, and let me know what you think. This time last year, I would have staged it with actual furniture, but with the stay at home order in place, the fact there are no open houses, and we weren’t sure how long it might sit on the market. With any potential viewers looking at it online, it made sense to stage it this way… and I’m thrilled to say it worked. To everyone’s surprise, the property sold in 5 days. This is in contrast to the fall market where, smaller one bedroom condos were sitting on the market some sometimes months.
And now let’s look at the numbers from the Toronto real estate market’s sales in December. They are off the charts compared to last December:
- Sales of detached homes were up by 41.9%
- Sales of semi-detached homes were up by 57.6%
- Sales of townhouses were up by 60.9%
- Sales of condos were up by 75.9%
While these are astounding numbers, you really do have to take them with a grain of salt.
First, compare the numbers year over year:
Compared 2019 as a whole, sales (in the 416) were up by 2.3% with an average price increase of 9.6%, which are good numbers, but not record breaking.
One thing to keep in mind is that at the end of the year, there is often a lot of activity. People have been looking to see what’s available through the busier part of the season but don’t start to jump until they realize fewer new listings are hitting the market.
Traditionally, the market slows down as we get closer to the holidays because buyers and sellers are going to parties and making travel plans, this year… there’s nothing for people to do but dream about being in a bigger space.
People who are working are saving money and putting it towards a new home, whether it’s a larger condo or house.
The average sales price is a littler higher, but it doesn’t mean that the average price is higher overall, just that more higher priced condos sold. See above where people were looking for larger units.
If we could isolate prices for smaller units, we’d likely see a depression in prices. Many units are selling for less than they did last December. The stats are deceiving because they’re looking at one type of property, but not looking at the nuances within that property type. There are still properties going above the asking price but they are harder to find and usually are for properties that check ALL the boxes and more.
The investor market is still substantially stalled although there does seem to be an uptick within the investor driven market. Overall, with the rental market depressed, investors are worried about buying and carrying a property when rental rates aren’t quite what they were. The good news it that investor confidence seems to be creeping back.
It’s an interesting time to be in the real estate market as things are constantly changing. If you have any questions about what your home may be worth, please get in touch!