Greater Toronto Area / GTA, Ontario - Tuesday June 3, 2020 – With the real estate industry adapting to a “new normal” - including protocols for showing homes - May’s MarketWatch - the Toronto Real Estate Board’s monthly residential statistical report released this morning - reflected continued year-over-year price stability and a tepid bounce-back from April’s sales volume. There's cautious optimism as we look forward; as the economy begins to re-start; and as reflected in a new Ipsos survey which showed that over a quarter of households in Toronto and the GTA are “likely to purchase a new home over the next year”.
With showing volume down substantially - in part due to increased “vetting” of homes using on-line tools such as virtual tours, meeting apps, and so on in order to reduce the number of homes a buyer might physically visit before buying one - sales volume did bounce about ten percent from April’s figure. It was still, however, down more than 53% from last May. [April’s volume was down 67% from the prior April. All figures herein are year-over-year comparisons unless noted otherwise.
Inventory: An ongoing issue
Tight inventory continues to be a major factor and the reason prices overall remained stable in the face of much lower sales volume. Prices, in fact, showed a 3% uptick to $863,599. That was a five percent gain versus the month earlier. The supply/demand dynamic has stayed incredibly resilient.
Total Active Listings stood at 11,448 which was 42.8% lower. Forward Inventory - calculated as Active Listings / Sales - was 2.49 months though that’s actually a significant improvement from just 2.01 months last May. The Absorption Rate - the rate at which the market is “absorbing” new listings in the form of sales and calculated as Sales / New Listings - was .506 versus .513.
TRREB’s overall sales volume - including all house & condo types reported through the TRREB MLS® System - was 4,606 units. That’s a 53.7% drop as noted above.
Sales of Detached homes in Metro Toronto totalled 432, down 63.1%, at an average of $1,422,273, up 2.7%. In “The 905” - the balance of the GTA - 1,853 Detched homes sold, down 46.4%, at an average of $942,668, up 1.8%.
Semi-Detached sales in Toronto proper numbered 164 on the month, down 59.7% and 651, down 50.9% in the rest of the GTA. Average sale prices were $1,143,322, up 8.8%, and a relative bargain $716,549, up 5.6%, respectively.
Bungalows for sale in Metro Toronto, The GTA, and South-Central Ontario in general are more popular than ever as Boomers age and a trend in general accelerates out of the more congested areas on top of the pre-existing trend of empty-nesters wanting to downsize to a Bungalow, often outside the city for any number of ?reasons: Get closer to kids and grandkids; take some tax-free equity dollars off the table to pad retirement accounts, and so on. Bungalows are also popular with younger singles and couples - not to mention investors - for many reasons.
Sales of Condo Apartments had a difficult month: Not only were some buildings not allowing access to anyone except residents - thereby effectively not allowing physical showings to “outsiders”, there’s also some fear about “common areas” - particularly elevators - with a viral pandemic on. 727 units sole in “The Big Smoke”, down 58%, at an average of $674,028, up an even [and respectable] 5%. The rest of the GTA saw 275 units trade, down 65.7%, averaging $$497,010, up 3.9%.
Quoted in the Report...
John DiMichele, TREB CEO: “While the public health and economic concerns surrounding COVID-19 continue to impact the housing market, the May sales result represented a marked improvement over April. TRREB released updated Ipsos consumer intentions polling results in May that indicated that 27 per cent of GTA households were likely to purchase a home over the next year. Providing we continue to see a gradual re-opening of the economy, it is very possible that home sales will continue to improve in the coming months.”
Jason Mercer, Director, Market Analysis, TREB: “With home sales and new listings continuing to trend in unison in May, market conditions remained balanced. This balance was evidenced by year-over-year average price growth slightly above the Bank of Canada’s long-term target for inflation. If current market conditions are sustained during the gradual reopening of the GTA economy, a moderate pace of year-over-year price growth could continue as we move through the spring and summer months.”
Homes sold “26.3% slower” this May compared to last at 24 Days on the Market [DOM] versus 19 last May. “Property Days on Market” [PDOM] which reflect the total days a home was listed with the same Brokerage - including listings terminated & re-written - was “18.5% slower” at 32 days versus 27.
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