For the first two months of this year, the Toronto housing market showed signs that it would continue to grow as the spring season approaches when the home-buying activities are usually at its peak. However, unexpected circumstances brought by coronavirus in mid-March caused momentous changes in the housing market.
From March to May, home sales went on a decline due to public health and economic concerns brought by COVID-19. Sellers also hesitated from listing their homes for fear of not getting the best price. While most homebuyers waited for when the market recovers before they purchase a home.
With the current crisis, there have been inevitable decrease of figures in the real estate market for the past 3 months. However, there are significant improvements for the month of June. Let us take a look at the numbers presented by TRREB in their latest June 2020 statistical update for GTA.
Source: TRREB July 6, 2020
Year-over-year Total Residential Transactions
June 2019 - 8,826
June 2020 – 8,701
There is a decrease of 1.4% in sales compared to last year. Despite this, there is a significant improvement in June 2020 sales result over May 2020.
May 2020 – 3,546
June 2020- 6,518
There is an increase of 83.8% in sales compared the previous month.
The number of home sales in June decreased by 1.4% on a year-over-year basis, but this is a tremendous recovery from the 67.1% year-over-year decline reported for April 2020. It seems like April is the lowest point of the COVID-19 recession.
There is also an increase in the average selling price of homes
June 2019 - $ 831,882
June 2020 – $ 930,869
There is an 11.9% increase in selling price compared to last year.
There is also a consistent increasing pattern if we will compare the average selling price in the previous month
May 2020 – $ 825,707
June 2020 – $ 906,874
There is an increase of 9.8% in selling price compared the previous month.
If there is a gradual recovery in economy, it is predicted that home sales will continue to improve in the coming months.
During the worst months of the pandemic from mid-March to May, there was a significant drop in listings as sellers hesitated to put up their properties for sale. As things slowly return to normal, it seems like listings in the market has picked up again. In fact, June 2020 new listings is up by 2.1% compared to June 2019.
Total New Listings
June 2019 – 15,824
June 2020 – 16,153
The number of new listings rose 2.1% on a year-over-year basis.
The June 2020 % Sales-to-New Listings Ratio of 54% decreased by 2% compared to 56% of last year.
Condominium Sales Statistics
Year-over-year Total Condo Apartment Sales
Q4/18 – 5,170
There is an increase of 3.8% compared the previous year.
The average selling price for condos is also growing steadily
Q4/18 - $ 558,733
Q4/19- $ 616,591
There is an increase of 10.4% compared the previous year.
Here are the summary of the listings of condominiums
Year-over-year Total New Listings
Q4/18 – 7,273
There is a decrease of 11.9% compared the previous year.
The condominium apartment market with its growth in sales and average price continued to perform well at the end of 2019. Many first-time buyers look at condo apartments as a more affordable option in home ownership. Getting condo apartments also mean not having to deal with long travel to work and other basic maintenance like shoveling snow and mowing the lawn.
At the peak of the coronavirus recession, there was very little condo supply. When enough supply comes to market, then more expensive condo apartments will drop in price. Many condo projects are also scheduled to finish their completion in the next few months.
There are a total of 767 sales in townhouses, up by 41% compared to last year. As of July 2020, 1 Bedroom townhouse is at $ 669,000 average selling price.
To sum it up, Toronto home sales showed great recovery from the past 3 worst-hit months of the pandemic. The re-emergence of high housing sales and prices that started in May and continued in June might hint of Toronto’s strong housing market as we anticipate a gradual recovery for the next few months.
As the situation gets better, new listings have once again come up as there is an increase in demand of buyers and lower interest rate from the bank. For the condo market, more condo unit supplies are also expected as many projects are lined up for completion in the coming months.
The recovery process will depend much on continued progress in lowering the infection rate for coronavirus and as control measures will be gradually relaxed. What will happen next depends on the second wave of the COVID-19 outbreak.
“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,” TRREB President Lisa Pate
If you have any question about Toronto housing market or need help buying your new home, contact me at 647-834-9928 or send an email to firstname.lastname@example.org