July 10 Market Updates
Toronto home sales rebounded in June, with the average selling price up 12% from the same month last year to $1,022,138. (first time we have surpassed $1 million) For the GTA region, the average price of a home hit $930,869 also up 12%. Competition is heating up again with multiple offers and bids well over asking prices. Homebuyers were forced to put their purchases on hold when the pandemic hit in March. Now that Ontario and Toronto are easing restrictions, buyers have started to pounce. The GTA saw 8,701 homes sold in June, up 84% compared to May and signals suggest that some of that momentum is continuing into July.
In the surrounding suburbs and nearby cities, prices also surged, in part because of demand from Torontonians looking for more space. The strongest price growth for the city of Toronto was in semi-detached homes, up 22% from a year ago to an average of $1,287,832 and detached homes up 14.3% to an average of $1,523,770. The condo market also saw price growth of 5.6% in Toronto, where the average price is now $672,000.
How long will this “catch-up phase” last? Some economists predict this frenzied pace will not last. CHMC said it is too soon to revise its forecast and pointed to a number of risks that could hamper the housing market, including sustained job losses, a slow recovery, and a second outbreak of COVID-19 cases leading to another lockdown. The agency had also forecasted a decline in home prices of up to 18 percent for this year although so far that is not bearing out, with the Toronto region’s housing market on fire. We are still in the early days of recovery, but a gradually improving labour market – (Statistics Canada today posted the economy added nearly one million jobs in June) and historically low mortgage rates are expected to support a recovery in the second half of 2020, barring any setbacks.