11 Jun Market Update May 2018
**City of Toronto Real Estate Market Update**
In the month of May, we continued to experience a decline (21%) in overall sales activity year over year (YoY) in the city of Toronto. All home types experienced double digit declines in sales volume in the fifth month of the year. It’s no surprise that sales are off quite significantly; new listing inventory is down (supply side) and the addition of new government mortgage regulations has hampered consumers (demand side). This has had a profound impact on overall transaction levels in the city of Toronto.
Although transaction levels have declined significantly, overall YoY price declines were modest at a rate of 4%. The detached and attached row/townhouse home segments experienced slightly greater declines at a rate of 5%. Semi-detached homes showed some resilience in price as this home segment rose by 1% YoY. Condos maintained the highest growth rate with YoY price appreciation at a rate of 7%. Although demand in certain segments of the market have declined, I am still seeing multiple bid situations and often pre-emptive offers on homes located in most of the central, east and west prime Toronto neighbourhoods especially houses listed under $1M.
Overall, I expect house prices to level off once we get into the summer months, with modest price increases going forward for the Toronto real estate market. I still see significant demand for condos as such, prices should continue to increase at greater rates versus house segments of the market.
Let’s tackle the inventory story by looking at new listings and active listings in the month of May. There was a change in the market that we started to see in April ’18 and has become more prevalent in the month of May. Although we continued to experience double digit declines in new listings, active listings began to display declines in two of the four key housing segments: semi-detached homes and attached row/townhouses. In addition, even though active listings in detached houses and condominium apartments increased, these gains were quite modest (3% and 2%, respectively) when compared to previous months in 2018. As such, we are beginning to see listing supply waning as we enter the summer season. If this phenomenon continues, it can put upward pressure on prices, so I will be continuing to watch inventory levels closely to see its impact on prices.
I can report that the Toronto Central, East and West markets, are still seeing tremendous turnouts at weekend open houses and offer nights are still attracting multiple bids for the right properties in certain Toronto neighbourhoods, while other properties that may require a renovation or are in less desirable areas will likely sit on the market for longer periods of time.
If you’re looking to sell and want to know what your home is worth, or you are a buyer looking to find a home in a neighbourhood of interest, just call, text or email me any time.
Keeping You Better Informed To Make Smart DecisionsTM
Mark Lebovits, Sales Representative
Royal LePage Real Estate Services Ltd., Brokerage
416-274-4984 | email@example.com