Market Update for Jan 24
Is it safe to say that the Toronto real estate market is moving into uncharted waters these days? The go-to response to the steady increase in prices has been the lack of listings, high demand, and low borrowing costs. Are we seeing a flashback to early 2017? What has transpired are stories of multiple offers, wild bidding wars, and many broken dreams. So, what should we expect as we move forward this year? We complained about not enough listings last year too, so we expect to see high demand pushing prices in an upward direction for the unforeseeable future.
The freehold sector is starting to show signs of life as we saw more listings come to market last week. Compared to last year at the same time though we are down 32% in new listings. The lack of inventory discourages some buyers from even looking because they don’t see much selection out there. That, in turn, suppresses supply because they’re not listing their existing homes. With more sales than listings happening the increased competition resulted in an increase of 48% of available properties selling at or above the asking price.
If you thought of shifting your dreams of homeownership to the condo market would make life easier, be prepared for a little disappointment. Throughout 2019 we watched as competition for resale condos increased dramatically from about 35% of all condos selling at or above the list price at the beginning of the year to over 48% by December. January 2020 has not shown any relief. In fact, last week’s numbers showed that 55% of condos sold in multiple offers, thanks in part to a shortage of listings coming to market. Compared to last year at this time we are down 27% in new condo listings.