The Greater Toronto Area real estate market recorded a whopping 7,180 transactions in the month of December according to the latest data from the Toronto Regional Real Estate Board (TRREB).
The December sales numbers set another record showing a 64.5 per cent increase year-over-year. The average price of homes sold in December was $932,222, an 11.2 per cent increase from December 2019, although homes outside the city of Toronto outpaced growth within the city by a wide margin.
“The Greater Toronto Area housing market followed an unfamiliar path in 2020. Following the steep COVID-induced drop-off in demand during the spring, home sales roared back to record levels throughout the summer and fall,” said Lisa Patel, president of TRREB. “A strong economic rebound in many sectors of the economy, ultra-low borrowing costs and the enhanced use of technology for virtual open houses and showings fuelled and sustained the housing market recovery.”
As has been the trend throughout the second half of 2020, the real price growth took place outside the city of Toronto and mostly in the detached home market. But, after months of sluggish sales, even the condo market got in on the act with 2,193 sales in December, a slight increase from November and up 75.4 per cent from the December 2019 totals.
“While the housing market as a whole recovered strongly in 2020, there was a dichotomy between the single-family market segments and the condominium apartment segment,” said Jason Mercer, TRREB chief market analyst. “The supply of single-family homes remained constrained resulting in strong competition between buyers and double-digit price increases. In contrast, growth in condo listings far-outstripped growth in sales. Increased choice for condo buyers ultimately led to more bargaining power and a year-over-year dip in average condo selling prices during the last few months of the year.”
Anecdotally, there is some indication that a condo recovery is already underway as sales have picked up in and around downtown Toronto over the last month.
“Everyone’s got people coming out of the woodwork that want to buy an investment condo right now — people who were not investors before. They just bought a house four years ago and they see (condo) prices falling. They see this as an opportunity,” said realtor John Pasalis, president of Realosophy for an article in the Toronto Star.
With two vaccines already beginning distribution in Canada and more on the way, a recovery from the COVID-19 pandemic is imminent, although the exact time frame is unclear at the moment. Some experts such as CIBC chief economist Benjamin Tal have predicted a rough couple of months for condos and then a major recovery as life begins to get back to normal.
“For the long term, I think that the winter will provide some good entry positions given the relatively soft nature of the market,” said Tal. “I think that the spring will be relatively strong.