Weekly Toronto Real Estate Market Update #003
Monday Apr 27th, 2020Share
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What’s up everyone? I’m Fred Tam and welcome back to your weekly Toronto real estate market update. This is Episode 3.
This past week, we saw homeowner confidence continue to decline. Nobody is selling homes. Ok, that’s not entirely true. There’s just under 1,500 homes for sale in Toronto right now, which is about 21% of all homes for sale in the GTA. With the number of homes for sale as low as it is, wouldn’t this be considered a seller’s market? Let’s take a look at it.
Home sales fell down another 13% since the previous week. We are nearly at sales volume levels that compare to winter, one of the slowest times of the year for real estate transactions. If we compare to the previous year’s Spring market, we are actually down from our forecast by about 75%. These numbers are likely going to get worse as the weeks go by. So before we go any further, subscribe to my channel and hit that bell icon. Because if you don’t, then YouTube doesn’t let you know when our new episodes come out and you’ll miss out on our weekly updates.
Ok so now let’s talk condos.
So just like other single family homes, condos sales also continue fall. They’re down 33% compared to the previous week. This pandemic is leaving condo owners with almost zero confidence in the market right now. We’re down 15% from the forecasted growth we should be seeing in the real estate market during this time of the year.
Home prices have actually come up from almost an all-time low this year. Homes in Toronto are on average about $1.27M now.
So now you’re thinking, Ok, Fred. Homes have gone down by about 20% since February. If homes on average are $1.27M, then, as a buyer, I can probably find a pretty good deal out there! And I’ll say to you,
Homes in Toronto last week sold for as low as $525,000. Here’s one that sold last week for $600,000.It’s a detached bungalow with two bedrooms and one bathroom. And I know what you’re thinking. “Well, this house doesn’t look like it has much going on for it.” But that’s not entirely true.
Remember when you were taught you shouldn’t judge a book by it’s cover? This home is sitting on nearly a 40 foot lot and it’s undervalued right now.
Check this one out that sold on the same street.
If you guessed $1.1M, you’re either incredibly talented at evaluating homes, or you cheated and fast forwarded through this video. So this home sold just four months ago in December last year, in the winter, for nearly $1.1M. But what else did you notice here? The one that sold last week for $600,000 is right beside it. Yes, that’s right. Within four months, two homes directly beside each other saw a difference in value of almost 50%. That $600,000 home was sold for lower than the average condo price in Toronto. Take another few seconds to think about that.
And while you do, Hit that Thumbs Up if you like this video and find the information valuable. Alright, let’s get back to the content.
Condo prices continue to fall as well. The Toronto average is at the lowest it’s been all year at $613,000 as of today.
Someone sent me a WhatsApp message last night asking why the people directly above and below are selling in his building. There’s a number of reasons why that could be. Seller motivation is largely dependant on their individual circumstances. I’m inclined to say that given what we just talked about, it isn’t price that’s motivating them, although that’s going to be intrinsically tied to the amount of equity they hold in their properties. Or maybe they just want to get as far away as possible from Toronto right now and move to a farm. The point is, we will likely never know why they are selling. The best thing we can do is stay up to date with the market, by watching videos like this, and making our decisions based on facts.
In the past four weeks, for every two homes listed on the market, one was taken down. And with the number of new listings flattening out, it’ll be interesting to see what homeowner confidence looks like as the weeks go by.
So If you’ve been listening closely, then you’re hearing that
A) Sales transactions are down
B) The number of homes listed are down (Low Inventory)
C) Market prices are down
Well, then isn’t this a formula for a seller’s market? No, not exactly. A seller’s market needs two things. Low inventory, which we have right now, but also a high number of active buyers. You can also say that higher market prices are required to motivate sellers. So if it’s not a seller’s market, then are we in a buyer’s market?
Well, it depends on where exactly you live.
Toronto is made up of 144 unique communities that all react differently from one another. If one community is a seller’s market, the other might actually be a buyer’s market. The influence comes from the homeowner confidence within those individual communities. If you’re curious to know more about what kind of market you currently live in, let me know in the comments and I’ll respond to you!
So that’s it for this episode.
Be sure to Subscribe to my YouTube channel and Like this video. Because if you don’t, then YouTube doesn’t let you know when our new videos are released and you’ll miss out on some really cool educational real estate content.
Also, if you’re curious to learn more about buying Pre-Construction homes, be sure to check out this YouTube series here. You’re gonna learn so much about the process, and the series is gonna get filled with more content over time that will cover every single aspect of pre-construction homes.
I hope you enjoyed this episode. Thanks for watching and I’ll see you guys next time.
Real Estate Education • https://www.youtube.com/playlist?list=PLVt1mFxDHaHpbHJlypoQnAjJw_xYU_I5y
Pre-Construction Condos - Everything You Need to Know • https://www.youtube.com/playlist?list=PLVt1mFxDHaHp5MIXX5mhfpHDA_h4yhUp_
Toronto Regional Real Estate Board (TRREB) • https://www.trreb.ca/
Ontario Real Estate College • https://www.orea.com/
Real Estate Council of Ontario (RECO) • https://www.reco.on.ca/
Canada Mortgage and Housing Corporation (CMHC) • https://www.cmhc-schl.gc.ca/
Canadian Real Estate Association (CREA) • https://www.crea.ca/
Tarion • https://www.tarion.com/about/warranties-plan-act-and-regulations
Humber College Real Estate • https://humber.ca/realestate/
National Association of Realtors • https://www.nar.realtor/
The Star • https://www.thestar.com/business/real_estate/2020/05/18/is-covid-19-an-unexpected-shot-at-home-ownership-for-first-time-gta-buyers.html
CTV News • https://www.ctvnews.ca/business/pattie-lovett-reid-three-real-estate-trends-emerging-from-the-coronavirus-pandemic-1.4950069
Global News • https://globalnews.ca/news/6688074/ontario-doug-ford-coronavirus-covid-19-march-17/
City News • https://toronto.citynews.ca/2020/05/23/trinity-bellwoods-packed-coronavirus/
Daily Hive • https://dailyhive.com/toronto/trinity-bellwoods-cherry-blossoms-fences-enforcement-patrol-coronavirus
ReMax • https://blog.remax.ca/no-nosedive-ahead-for-canadian-real-estate-prices-re-max/
My website • https://www.fredericktam.com/
Facebook (@fredtamrealestate) • https://www.facebook.com/fredtamrealestate/
Instagram (@fredtamrealtor) • https://www.instagram.com/fredtamrealtor/
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