Toronto Real Estate Market Watch 03/19
We hope everyone is staying warm this winter season! Here at The Richards Group, we are currently prepping for the spring market just around the corner, and we can’t wait to share what we’ve been working on in the next couple of months. Without further ado, here is our newest Market Report for the month of February!
To begin, home prices have stayed stable from January into February, increasing 1.6% to an average of $780,397 throughout the TREB region. The board reports that the more affordable condo segment led the price growth, up by 7.9% in January. Homes within the City of Toronto (the 416 & 905 regions) saw prices pick up a bit more, rising 4.1% to $840,211, though the 416 also experienced a -6.6% decline in sales.
The decline in sales, due to lack of inventory, is still the biggest problem for the Toronto market; 5,025 home sales represented a 2.4% year-over-year decline in homes sold, while a month-over-month decline was also felt from January 2019’s figure. While the 905 had slight gains, the 416 submarket felt the lack of inventory the hardest.
New listings declined in February, falling from a GTA-wide 10,473 in February 2018, to last month’s 9,828. Listings within the 416 remained steady, dropping slightly year-over-year from 3,365 to 3,301. A steeper drop-off was recorded in the 905, falling year over year from 7,108 listings down to 6,527.
So, what does this translate to in the market? For one, the tightening market conditions push price growth up, so it continues to climb – due to lack of inventory, people pay more to secure their offer.
Despite the challenges, TREB reports and predicts “moderate improvement” in sales & sale price, but also warns not to expect the same sky-high records seen in previous years. The board says other factors such as population growth, low unemployment rates, and stable interest rates will help Toronto’s housing market this year.
Much of that price growth will be led by the hot condominium market as homebuyers look for more affordable housing options, while the board anticipates the price growth for detached properties to be below the average growth rate for the total market.
On that note, if you own a detached property, and if you’re looking at our stats & charts, you might be sweating bullets that semi-detached homes sold, on average, for more than a detached property in February 2019. These stats are not wrong, but it’s also no cause for alarm – let’s break down the information.
For starters, more detached homes sold than semi-detached homes. In Toronto east, 177 detached homes sold in February 2019, compared to 63 semi-detached – almost 3 times as many detached homes sold than semi-detached! More homes sold means a greater pool of prices to pull from, and if many lower priced detached homes in Scarborough are selling, compared to a hot Leslieville market where pricier semi-detached homes are all the rage, then it will skew numbers accordingly.
Second, and expanding on that last point, it depends on the type of detached home that is being sold. While a range of homes are almost always available, many sellers are currently sitting on their properties and waiting for the “right time” to sell – this leads to more affordable detached homes selling quickly, since that is what is available on the market. Once we officially enter the spring market, we expect to see gains when buyers are out in full force and there is more inventory.
What this data also tells us, is if you are the owner of a semi-detached property, now would be an amazing time to start thinking about the value of your home, and its future – are you thinking of down-sizing? Moving abroad? Trading up? We can help you with managing those choices and making the most of your move, wherever you want to end up. Reach out to us to get a conversation started today!