Be Discerning With The Media
Discernment and judgement are two very powerful forms of understanding and digging deeper into meaning and whether an issue makes sense. We often see headlines in the media (and other real estate agents, for that matter) claiming that the market has dropped or housing sales are down, or a correction is upon us again. In contrast, other outlets may state that there is still a substantial uptick in activity.
Real Estate Facts:
- Fewer listings mean fewer sales.
- Fewer sales mean few transactions.
- Values drop (lower) – could mean that prices have dropped, or (and this is important) that there are fewer higher-end sales or more entry-point sales prices that skew the sales at any given time or that there are not enough sales to provide accuracy to the true values of homes.
- There is no:
- “Canadian real estate market” – what does Winnipeg real estate have to do with Toronto, Vancouver, or Chatham, for that matter? You cannot compare and contrast these unrelated markets.
- “Ontario real estate market” – same as above, what does Windsor have to do with Muskoka or Toronto? Exactly nothing.
- “Toronto real estate market” – aha, so is there one? Well, yes and no. At least we are more localized. However, the Greater Toronto Area is huge. So, what does a factory shutting down in Rexdale have to do with condo sales in King West? Nothing. What do Rosedale real estate market values have to do with Leslieville? Again, very little to no correlation. Understanding condos versus houses and the local market is integral. Careful of what you allow into your mind. Discernment and judgment are requested. Mix in some logic as well.
Recent Experience:
We recently had a listing agent who made a poor strategic decision to raise the seller’s asking price by 15% the day after “offer night” came and went with zero offers. When showing the house a second time to buyers three weeks into the second listing, he claimed that activity was really picking up. Err, it’s July, and activity never picks up at this time of year. It’s a poor sales tactic. Side note, there was no follow-up on the questions that we asked. Needless to say, that house will need to drop back down to reality. The reality is that real estate transactions (sales) slow down during the summer. Always do. Likely always will. Why? During summer vacation, people, including Realtors, like taking time off. Why list your home or condo in Toronto when there are fewer buyers in town who are focused on purchasing? It’s not an ideal way to maximize your investment return. Thus sellers wait until after the September long weekend before listing. So relax and watch the media pundits wax on and on about a shift in the marketplace.
All the above being said, we expect the market to soften. For how long? We’re unsure. We can be sure of one thing: judging July and August Toronto real estate sales and values is not the time to draw a line in the sand. The true barometer will be mid-Septmenrb as more listings hit the market.
As mentioned in last month’s real estate market update, we continue to watch the market closely with the likely increase of the BoC lending rates, their impact on the variable rate mortgages, and the bond market’s effect on fixed mortgage rates. Something does need to shift. We expect that a flatter market will be our future for some time.
And just as we say this, we begin thinking about what the potential impact of 500,000 new immigrants in 2023 will have on our real estate market…
Be discerning with us as well. After all, we are good at asking questions and poking holes in theories, but we have never been able to predict the future. We can try, but we hold that viewpoint loosely.
Toronto Real Estate Market Report – June 2023
June 2023 was extremely quiet in Toronto’s central areas. There were only 1349 sales. Toronto’s real estate has begun its recovery. Our overall annual markers will provide a better sense of value increase, which you can reach out to us here to discuss.
Detached Home Values
There were 258 sales in central Toronto in June 2023. The average home sold for $2,450,660, Up 5% since June 2022 (we are now seeing the year over the years values come into place, there is no doubt that the correction has taken hold of our real estate market.) The average home was on the market for 13 days – below the Toronto average days on the market – this tells us that active buyers want to buy today.
Semi-Detached & Townhouse Values
There were 241 sales in central Toronto in June 2023. The average home sold for $1,564,623, up 4% since June 2022. The average home was on the market for a relatively short time compared to the TRREB days-on-market average of 10 days.
➤ Check out our top reads for anyone thinking about living in Toronto:
- Why Parents Should Invest In Toronto Condos For Their Children
- This Is the Year For Buyers To Buy In Toronto
- Selling A Home In Toronto
Toronto Condo Values
There were 850 condo sales—the average central Toronto condo sold for $863,719, up 2% from June 2022. The average condo was on the market for 19 days – condos are beginning to move more quickly as buyers accept the interest rate hikes. Note that the correction has not impacted Toronto condos as much as the freehold housing market.
Contact us here and read through our blogs to learn more about Toronto real estate.
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