MARKET WATCH * BACK 2 SCHOOL COUNTDOWN
What can I say about the Toronto Real S. Taitt market except, here we go again. Record sales, record highs and record levels of unemployment. These things don’t add up, however it’s hard to look for logic in such an emotionally charged industry. Therefore, everything is up. Up by 30% from last July and approximately 50% from last month. July was hot and hotter than your normal July.
Total new listings were up as well 14,403 in July 2019 and 17,956 in July 2020, that’s almost 25%. It appears the market is trending upwards, however, the only elephant in the room is our global pandemic
We are still in the middle of a global pandemic and I am quite sure the dust will begin to settle any day now. What does that mean, you may ask and do I have to wear a mask? Will we see some price corrections or a surplus of listings? Hmmm, arguably we have never seen a surplus of homes for sale in the city of Toronto. Furthermore, we have always experienced a shortage of properties in Toronto, and during these times of COVID, there is no difference. The lack of a spring market has caused the summer months to be unusually busier than normal, hence the pent up demand and big summer growth percentages.
With record unemployment and a complete overhaul of various service industries, a change is inevitable. I just don’t know when. I don’t have any answers or predictions of where do we go from here. The only thing that I can say with certainty is, properties within a 200 km radius of the centre of the universe (Toronto) will likely see the greatest percentage increases. Here is a great TORONTO LIFE article which looks at the Crash O Meter. Like many of us, we sit wait and hope that this winter will give us grace. Spare us from another outbreak, climbing numbers and stressed out health care workers. Let’s think positive and remember that, it’s all about perspective.
TORONTO, ONTARIO, AUGUST 6, 2020 – Toronto Regional Real Estate Board President Lisa Patel announces that Greater Toronto Area REALTORS® reported 11,081 sales through TRREB’s MLS® System in July 2020 – a 29.5 per cent increase over July 2019 and a new record for the month of July. On a preliminary seasonally adjusted basis, sales were up by 49.5 per cent compared to June 2020.
Year-over-year sales growth was driven by low-rise home types, particularly in the regions surrounding the City of Toronto. However, condominium apartment sales were also up on an annual basis, including in Toronto.
Total new listings were also up strongly on a year-over-year basis by 24.7 per cent, but this annual growth rate was less than that of sales, which means market conditions tightened on average compared to July 2019. In addition, active listings at the end of July were down by 16.3 per cent.
“Sales activity was extremely strong for the first full month of summer. Normally we would see sales dip in July relative to June as more households take vacation, especially with children out of school. This year, however, was different with pent-up demand from the COVID-19-related lull in April and May being satisfied in the summer, as economic recovery takes firmer hold, including the Stage 3 re-opening. In addition, fewer people are travelling, which has likely translated into more transactions and listings,” said Ms. Patel.
The July 2020 MLS® Home Price Index (HPI) Composite Benchmark was up by 10 per cent compared to July 2019. The overall average selling price was up by 16.9 per cent year-over-year to $943,710. On a preliminary seasonally adjusted basis, the average selling price was up by 5.5 per cent compared to June 2020.
Price growth was strongest for low-rise home types, notably within the City of Toronto. Despite more balanced market conditions in the condominium apartment market segment, year-over-year price growth remained in the high single digits.
“Competition between buyers continued to increase in many segments of the GTA ownership housing market in July, which fueled a further acceleration in year-over-year price growth in July compared to June. On top of this, we also experienced stronger sales growth in the more-expensive detached market segment, which helps explain why annual growth in the overall average selling price was stronger than growth for the MLS® HPI Composite benchmark,” said Jason Mercer, TREB’s Chief Market Analyst.