Each week, The Glenn Team provide highlights from the weekly CP office meeting to provide a blanced overview of the Toronto and GTA markets and relevant issues affecting real estate markets. Meetings are overseen by Chestnut Park's CEO and Broker of Record, Chris Kapches, LLB, who provides weekly analysis and commentary. Additional input is provided by the CP Toronto office Realtors who give a day to day, real life perspective of the local markets.
This week's analysis of the market parallels much of what was covered in last week's post. However, there is one central theme that Chris drew upon concerning the housing market in Canada as a whole, and how Toronto and it's various districts mirrors it.
As evidenced in the chart below, we are finally getting evidence of a plateau in the GTA market, and there is an expectation that sales numbers and values will begin to climb by the end of September. The year over year negative variance is beginning to decline indicating volume is stabilizing.
There is a wide range of activity between various districts in both the 416 and the 905, with the average sale price down by about 1.2%. Chris feels this is due in large part to fewer detached properties in the $2M+ range. However, certain areas of the city, ie. E01, E02, and E03 have properties still selling over 100% of ask (ignoring any price discrepancies) with average days on market around the 14 day mark. The majority of sales in August were semi-detached (up 15.4% yr/yr) and condo apartments (up 21% yr/yr). Looking to the 905 districts, we see a decline in volume of almost 42% which also likely accounts for a drop in average price through the GTA. For both districts, the months of inventory (healthy around 3 months) is still quite low, being around 1.3 months. The sales to list ratio around 64.4% in the 416 as opposed to just under 59% in the 905 means that the 416 is moving faster and holding it's value better than in the 905.
CONDOS ARE KING!
Another shocking stat to be aware of is the average sale price for condominium apartments, which just broke the $600,000 mark at $600,781 in August. Clearly the high demand for a more affordable product has made it less affordable overall. With supply levels being drastically low, we should expect this trend to continue unless some new inventory comes up soon. For some perspective, there are about half the number of condos currently listed as a year ago, down from around the 5000 mark.
CANADIAN REAL ESTATE PERSPECTIVE
The big take away from all of this information is that Toronto appears to be on the rebound (though we'll have a clearer idea by the end of September), following suit to cities like Vancouver and Montreal. While Montreal hasn't seen the generous gains of the Toronto market, sales prices have been rising about 3% yr/yr and Vancouver is showing big gains in both volume and sales price (22.3% and 9.4% respectively). Economists point to the same factors for all 3 cities; job creation, consumer confidence and migration. All things being relatively equal, we should expect the Toronto market to be headed higher once the psychological effect of the new rental rules and tax legislation wears off. The bank of Canada's rate hike may play into that equation somewhat but should only affect most mortgages by about 2% on average.
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