Toronto, 8 January 2019. As I welcome the new year, I feel that the winds of change are blowing as many pundits (I admit to being one) are touting the coming of the next industrial revolution or as it may become known as the “dawn of big data and Artificial Intelligence (A.I.).” Our industry, like many others, is undergoing fundamental change brought upon by technology and venture capitalists fighting for a piece of the over $4 trillion global real estate market. You can now get “sold” data online in Ontario, Zillow and others are invading our Canadian landscape, plus there is an excess of information to sort through and the year has hardly begun!
From our perspective, skilled and trusted advice will become even more relevant and sought after especially amongst the wise, non-do-it-yourselfers.
Contrary to what you may have read in the media, the Toronto Real Estate Market has followed the same trends in 2018 as it has done in the previous 21 years with two exceptions: the blip in 2008/2009 and the lack of supply aberration in early 2017. (Just follow the 2018 line in the graph below.) While there has been a moderation in the market, and it appears to have become more balanced, it is still a decidedly sellers’ market just as long as the sellers are realistic and not still living in April 2017! The sellers’ market still prevails mostly from a lack of supply. Inventory levels continue to be low in many neighbourhoods. And since there are over 400 unique “markets” within the GTA, there will always be a mosaic of hot, warm, and cool areas depending on how desirable a particular community may be.
But what about those winds of change you may ask…
- 2018 Overall average prices were down slightly yet they were up moderately in the city of Toronto and down in the surrounding GTA regions.
- From July to December 2018 prices were actually higher than for the same months in 2017
- Condo apartments were up on average 7.8% year over year.
- If you look at the base numbers, prices were on average down -4.3 % but versus December over a year ago, prices are up +2.1%
- We currently have about 12 weeks of inventory. (Over 20 weeks is considered a balanced market).
- Pricing your home correctly is more critical than ever. But asking price does not tell the whole story. And NOT all homes are selling for more than asking.
- Higher borrowing costs and the stress test did influence a portion of the buyer population.
- Condos are still selling fast in many areas! Homes $1.5 Million and above are taking much longer to sell. (Mostly because the asking price started too high)
- It is even more of a challenge for many folks to qualify for a mortgage. The only immediate factor that could affect the market would be an increase in mortgage rates.
- There is a drastic shortage of rental properties. Downtown Toronto now has the distinction of having the highest average price rental for a one-bedroom apartment in the country: over $2,100.
If you need help navigating the real estate market or if you simply want to ask questions about real estate, mortgage financing, Investing or renovation, let's meet for coffee?