Toronto Real Estate Market Report Courtesy Of Jason Mercer of the Toronto Real Estate Board

SALES COMMENTARY

The Toronto real estate market has peaked in terms of sales and prices! That’s not necessarily bad news. We are going to see a more balanced market going forward – not a major correction as doomsayers keep predicting. The economy is not heading into a recession but coming out of one. The fear of the HST and rising interest rates are probably overblown. The biggest factor impacting our market will be the supply of listings!

In May, TREB residential sales were down 1% from May of last year and were lower than in April. For the overall condo market, sales were 2% higher than a year ago. But when you look at downtown condos, sales were even better – 12% higher than the same month last year. As we have said previously, the condo market tends to lag the overall market by a month or two on a seasonal basis. In 2009, June was the largest sales month on TREB. Expect sales in June 2010 to be lower than May – about 9,300 units and almost 15% lower than June of last year. On a positive note, at the half year mark, year-to-date sales for 2010 will be 52,000 units as compared to 42,000 last year. Timing is everything.

SALES COMMENTARY:

Our last Report focused on how Government has done its best to slow down the real estate market, even though the real estate industry in total was responsible for about 50% of the economic recovery from the recession of late 2008 into 2009. In this report we will return to analyzing statistics and trying to make sense of where the market is headed. In April sales on the Toronto Real Estate Board reached 10,898 units which was an April record and the third biggest month all time. However clouds are starting to appear. TREB also recorded 20,683 new listings in April. When you look at early returns for May, sales will be lower than in April and will be about the same as in 2009 – best guess 9,700 units. At the same time, new listings are continuing to accelerate. Our last Report predicted that the market would peak in late April and it looks like we were right, in terms of sales activity. Prices are a different story. Prices tend to lag sales volumes and we are now seeing prices levelling off. Our best guess is that sales will begin to soften by the fall. Not the 20% that doomsayers predict but more like 2-5%. At the same time, we are already having a sizable number of buyers and investors who are looking to move into the market this fall. Should be interesting times.

SALES COMMENTARY

The Spring Market has arrived – about one month early. As reported by the Toronto Real Estate Board, sales in February were 7300 units – a 77% increase over February of ’09. Sales were higher than those in ’07 and ’08 and were in fact a record. Already March sales are tracking at 9,800 units which will easily surpass those of previous years and will be approaching April numbers. While a lack of snow is certainly a factor, it is apparent that everyone is in a rush to beat the self imposed HST deadline of July 1st!