Any chance of a drop in real estate prices associated with the COVID-19 pandemic already seems a thing of the past as the Toronto market came roaring back last month, according to the June sales figures provided by the Toronto Regional Real Estate Board.
Sales are up an incredible 89 per cent, and not just compared to last month. Sales are also up 84 per cent from a year ago in May 2019 after a serious slowdown during the height of the pandemic in March and April.
The MLS® Home Price Index Composite Benchmark is also up by 8.2 per cent year-over-year in June. But there was even more significant price growth in certain sectors of the Toronto market.
For instance, there was strong growth in the detached and semi-detached segments of the market in the city of Toronto at 14.3 per cent and 22 per cent respectively.
The average selling price across the Greater Toronto Area real estate market in June is $930,869 — up by 11.9 per cent compared to June 2019.
“Following the broader movement to reopen the economy in June, we experienced a very positive result in terms of home sales and selling prices. Before the onset of COVID-19, there was a great deal of pent-up demand in the market. This pent-up demand arguably increased further over the past three months. We are still in the early days of recovery, but barring any setbacks, we should continue to see stronger market conditions in the second half of 2020 as households look to satisfy their ownership housing needs,” said Lisa Patel, TRREB president.
New listings were up 2.1 per cent when compared to last year. However, active listings on TRREB’s MLS® System at the end of June 2020 were down by 28.8 per cent compared to June 2019.
On the ground, realtor Jamie Dempster says the Toronto real estate market is “on fire.” Recently, he had one west-end home sell after seeing 25 offers, and another 30 offers on a home along the Danforth in the east end of the city.
“The low interest rates coupled with the fear of missing out on home ownership in Toronto has the market hitting heights we haven’t seen since 2017,” he says. “Anything priced between $800,000 and $2,000,000 is seeing multiple offers. Once you move over the $2,000,000, it’s neighbourhood specific and slightly softer.”
According to Dempster, one factor impacting the market is older Toronto homeowners who had planned on moving into retirement residences this year are holding off that decision in light of recent events.
“This is a big part of the housing stock that we usually see come to market,” Dempster says. “Without this housing stock, the market is even tighter and the buyers outnumber new listings 10-1.”