Considering the summer lull in the market, there was an overwhelming amount of GTA real estate news coming out every day this month. The sellers, buyers and their agents were holding their breath waiting for the next update and trying to predict the future of Toronto's housing market. Finally, the much awaited TREB numbers are here to bring some clarity.
The sales were down 40.4 per cent compared to July 2016 with the detached segment seeing the most significant drop by 47.4 per cent. The number new listings increased by only 5.1 per cent this month, but it's the summer season after all.
The average selling price for all types of properties combined reached $746,218, which represents a 5 per cent increase year-over-year. The average price for a condo apartment soared by 23.2 per cent in comparison to the same month last year and reached $501,750.
TREB suggests that the drop in sales is rather a result of the wait-and-see approach that the home buyers adopted after the introduction of the foreign buyers' tax, and not a direct impact of it. Jason Mercer, TREB’s Director of Market Analysis also remarked that the supply and demand factors did not change in Toronto area, implying that the sales will eventually rebound. In any case, the recent shift towards the buyers' market is quite evident, leaving plenty of room for the buyers and their agents to negotiate.
With the number of sales having slowed down by 40 per cent over last year you might expect the average sales price to have dropped substantially but it is 5 per cent higher than last year's ASP. However, that is still a drop from the April 2016 average which was the highest in TREB history. At its present amount it is still higher than the past 4 years.
With the added number of listings, it is important for sellers to sharpen their pencils and do what is necessary to sell. If you wait for the market to change to get more for you home, then your purchase will also be affected by an increase. Sellers who are buying up are better served in a slower market as the difference between what they have and what they want is a lesser cost, and Buyers have never had a better market to buy in...and now you and your agent can negotiate.
The "waiting game" is how I see this current marketplace. Sellers are waiting longer with their properties on the MLS to get sold (most sellers are under no duress to sell and have lots of equity in their homes). Homes that are selling are realistically priced for today's market conditions and show very well.
Buyers are waiting to see if the prices will decline any further from the frothy highs of the start of this year (prices are still up on a year-over-year basis, but just not as much as they were at the beginning of this year).
In my opinion, smart buyers will get off the sidelines; there are fewer buyers out there to compete with, there is a healthy supply of listings to choose from and overall, the economy in Ontario is doing great (unemployment is at a 9 year low in Canada and Ontario leads Canadian provinces in GDP growth and in turn, Canada's GDP leads the G7). Why wait until the masses return to the marketplace? Act now and be glad that you did.
Also, don't let these stats fool you!! The market is still moving and good properties that are marketed correctly and show beautifully are still flying off the shelf in record time and for over asking. CALLING ON ALL BUYERS.... THIS IS YOUR TIME TO SHINE!!!We have been feeling the pulse of the market from the start of the year and it is no different now. The market is definitely changed and sellers have to change with it. Conversations and expectations like, "My Neighbour got $80,000 over asking for her place in March" are no longer productive. We have to work with what we have and sell in this market today.