February 2019 defied expectations for modest growth in average sold prices and number of property sales in the City of Toronto.
This year 1,879 properties were reported sold in the month of February, a decline of 6.7% as compared to the same time last year. The reason for this decline was due to a lack of inventory.
This February brought with it 3 major snow storms, effectively paralyzing the City on each occasion with snow mounting to alarming levels. It is therefore not surprising that properties did not come up for sale.
Only 3,301 properties came to market, 2.5% less compared to the 3,386 that came up for sale in February of 2018. Even the 3,386 properties that became available last year were insufficient to meet demand.
It is clear that demand is present and because of supply shortages it is beginning to pent up. In February the properties that sold caused the average sale price to increase for the second month in a row. All properties sold for $840,000 in February, over 4% higher then last February’s average sale price of $806,000.
The clearest example of both the supply shortages and the impact on average sale prices is February’s average sale price for semi-detached properties in the City of Toronto.
In February the average sale price came in at a shocking $1,087,363. Semi-detached property sales only exceeded $1 Million during the frenetic increase in prices in late 2016 and the early months of 2017.
The length of time that properties spent on the market also demonstrates how strong the City of Toronto’s resale market continues to be. In February all properties available for sale in the City Of Toronto marketplace sold in only 22 days.
Semi-Detached properties in the City sold even faster in 15 days. What is astounding and further proof that supply is insufficient to meet demand, is that all semi-detached properties sold for more than their asking price at 106%.
It is concerning that the last truly affordable housing type, condominium apartments, is rapidly becoming unaffordable. In February all condo apartments sold in the City of Toronto (on average) for $612,000.
In Toronto’s central districts, where most condo apartment sales take place, the average sale price came dangerously close to $700,000. With the increase in mortgage interest rates and the implementation of mortgage stress testing, these prices are making it very difficult for first time buyers to enter Toronto’s real estate market.
At the other end of the real estate spectrum, higher end property sales declined. In February 90 properties having a sale price of $2 Million or more were reported sold. This is a 10% decrease as compared to last year when 101 luxury properties sold.
The average sale price for luxury property in the City of Toronto in February was $2.83M. This marks a decline of 7.3% as compared to last February when it was $3.05M.
As we move into March and improving weather conditions, we anticipate more properties coming to the market to meet demand.
It would appear that buyers have accepted higher interest rates and mortgage stress testing but are frustrated by their inability to find suitable properties for sale.
Victoria Boscariolis a real estate agent in Toronto Canada with Chestnut Park Real Estate Limited Brokerage. With over 20 years experience, Victoria has been helping people successfully buy and sell condos and houses in Yorkville and downtown Toronto. As a Certified International Property Specialist (CIPS) she has worked with Buyers from around the world moving to Toronto from China, Russia, Brazil, India, South Africa, United Arab Emirates, Jordan, Cyprus, Italy, Germany, The United Kingdom, Australia and the United States. By building an international marketing strategy for every property she puts up for sale, Victoria's listings of Toronto homes and luxury condos get global exposure that attract qualified buyers from around the world.
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purchase, sale and lease of real estate as part of a cooperative selling system. Canadian Real Estate Association Last Updated: 11/17/2019 09:25:50 AM