Hi everyone, we hope you are all well and staying safe during these unprecedented times. The economy has started to slowly open (yay!) and after many conversations with our neighbours, home owners, and investors over the past couple of weeks, what we’ve heard and learned is that you want clarity, information on what is happening in the market and answers. We are going to do our best and provide some insight and answer the top 3 questions that we receive on a daily basis and we hope you can find it helpful. As always, we are here for you.
How has the Housing Market been Affected?
The Real estate market has adjusted accordingly with the volume of homes sold amongst all property types down 67% for the month of April. This is encouraging as it means people are taking the need to shelter in place seriously and staying home. New listing numbers overall in the GTA are also down over 40% compared to last year. This is a key number to watch. If new listing numbers continue to be low, prices will hold.
Will Prices Going Down?
Prices are still up from the same point last year, however, the sales that did happen in March/April are likely going to be lower than what we saw in the first two months of 2020. Many sellers that went to market during this pandemic were in a “must sell” situation, and that will likely be reflected in sales prices. Remember, it’s all relative. If you buy/sell in the same market conditions, you will experience the same gain/loss on both the buy and sell side.
What does the Future look like?
No one can predict the future, but we can look at the past. What we know is that the Toronto housing market has averaged a 6.73% yearly increase in price over the past 40 years. That includes the crash in the early 90’s, the 2008 Financial Crisis and the second half of 2017 after the Fair Housing Plan was implemented. You can view this many ways, but Toronto has had a housing shortage for many years and that’s why values have gone up at a rapid pace. Always focus on your “time in the market”; not trying to “time the market”.
Stay safe and well!