TREB reported 7,228 residential transactions through TREB’s MLS® System in March 2018. This result is indeed a 39.5 per cent compared to a record 11,954 sales reported in March 2017, but it’s really hard to compare data with a year that was considered record breaking.
The truth is, in a year-over-year comparison, sales are down for all segments. Detached homes are in the lead with 3,120 sales and 46.3 per cent drop. Semi-detached houses and townhouses follow with 30.6 and 34.2 per cent fall respectively. The condominium segment was down by 32.7 per cent with 2,183 sales. But those numbers only reflect a percentage of homes really purchased on the market. TREB statistics only count the condos marked as re-sale. So new constructions and pre-construction condos that are currently one of the most popular segments in Toronto, aren’t accounted for at all.
As for the prices, condos are still on the rise. That might be a confirmation that the condominium market is much more competitive than the re-sale numbers are telling us. It was the only segment in Toronto where the change in the average price was a positive number. With the average price of $551,003 for a unit, condos went up by 6.1 per cent in price. The remaining three segments are currently down, with detached homes falling by 17.1 per cent, semi-detached by 8.8 per cent and townhouses by 9.5 per cent. The total average price across all segments decreased by 14.3 per cent, from $915,126 to $784,558.
According to TREB, the number of new listings entered into TREB’s MLS® System represented a 12.4 per cent decrease compared to March 2017 and a 3 per cent decrease compared to the average for the previous 10 years. This could be a sign that many sellers are currently biding their time and waiting how the market will evolve in the second quarter of 2018. However, the inventory is strong, with the number of active listings up by 103.1 per cent.
Q1 2018 Statistics
In general, compared to the record-breaking first quarter of 2017, the start of 2018 wasn’t that much exciting, with buyers threading lightly, waiting for market to stabilize after the Fair Housing Plan, the new OSFI mandated stress test, and the sellers looking for prices to stabilize as well.
The number of sales in the first quarter of 2018 amounted to 16,482 per cent, which is 34 per cent less than Q1 2017.
The average price has fallen as well, by 10.7 per cent in Q1 2018. The average price for the period January-March 2017 was $854,431, this year it’s $763,053.
Richard Silver, Sales Representative, SVP-Sales
It is always hard to compare a year that follows a “record” year. Any statistics will be a disappointment. However that being said, on the ground, we are still seeing great activity in the 416 area code and in the condominium market. Remember the condo market hardly existed 30 years ago and now it is responsible for over 50 per cent of our sales within the GTA and there are another 26,000 units scheduled to be built in 2018, down from 35,000 last year. Those figures added to the total of 25,000 re-sale condos make for a brisker market than the TREB Stats would show. TREB only tracks re-sale condos and not new construction, so adding the new condo sales to the re-sale sales makes for a more robust housing market than years ago, when only a much smaller number of new condos would have been sold. At the present, there does not seem to be a body that tracks both to really show us what the real housing market activity is…only the Land Registry system would have accurate numbers. It is time for Land Registry to start compiling accurate numbers of transactions and providing those statistics for the public so that we can all have more accurate statistics.
Rizwan Malik, Sales Representative, SVP-Sales
The goal of the media should not be to sell headlines but to offer real hard data that people can understand and use to make educated decisions. What ends up happening is that people read a report that says the market has dropped by 39 per cent and when they meet us to negotiate their deal they have this false feeling of power. The reality is, certain market segments have not changed at all, if anything, they have gone up! It is true that the market as a whole has softened from where we were in the first quarter of 2017. However, we are still moving a lot of inventory and have a lot of happy buyers and sellers. The only people who are unhappy are those holding on to something that no longer exists.
Jim Burtnick, Broker, SVP-Sales
A Tale of Two Markets times two:
905 vs 416 : I cannot recall a bigger discrepancy between the 905 suburbs and the 416 Toronto proper marketplace. If you live in the suburbs, the freehold residential marketplace is down by as much as 30% from its peak with lots of active listings. If you live in Toronto (south of Hwy 401), the freehold marketplace is much steadier with limited supply and strong demand – here we are still seeing multiple offers but these are not guaranteed, they require astute marketing and pricing strategy.
Freehold vs Condo: The detached and semi-detached category of real estate used to always lead the price appreciation statistics. That is not the case any longer. Condos are the hot commodity and are reflected as such in the highest overall appreciation.
The market has changed and will continue to do so, we are seeking it daily, weekly and monthly. Change is the only constant.