Numbers can be confusing. Some very alarmed clients have called me recently, asking about the recent drastic downturn in Toronto Real Estate sales numbers. I felt quite foolish – the last numbers I had read were very positive – condo sales were up, as were single family homes. I frantically combed through the media articles, trying to understand why there were starkly different reports as to what was happening in the GTA. Let’s take a look at some of the contradictions and find out what’s going on…
The Financial Post recently reported that ‘Toronto condo sales hit decade low’. The title certainly grabbed my attention. How are we supposed to make sense of the decline in sales when we see an article from the Toronto Star that reads: “Some of the strongest growth numbers were seen in Toronto’s beleaguered condo sector last month where sales were up 20.1 per cent across the GTA — 21.4 per cent in the City of Toronto — and prices climbed by 3.7 per cent year over year”.
Very odd. Two seemingly contradictory reports for the same area in the same time frame. Luckily, the articles contain links to the source of the confusion. The Post referenced brand new-builds (RealNet Canada), whereas the Star article referenced the Toronto Real Estate Board’s Marketwatch, which is primarily geared to tracking ‘re-sale’ homes. This wasn't clear in the articles.
Simply put – the articles were quoting two completely different sets of numbers. The resale numbers are very healthy. Condos are moving again, after a sluggish summer. Single family homes are moving well, as they have for quite some time. There are price points, and particular pockets of the city, where this is not the case – but overall, the market is very robust.
However, new condos and home sales numbers have drastically decreased. Which makes sense to me – why would you buy a condo that’s three years from completion when a lot of people are saying that the market will become saturated? Gone are the days when you can get a 25% return as soon as the building is completed – those days disappeared a long time ago (in my opinion - good riddance - keep the speculators out!). Also, with the greenbelt surrounding the city, I believe that new single home starts will decrease because we’re running out of land for expansion. Toronto will grow up, not out. Please take a look at some of the most recent numbers posted below, taken from the TREB’s database of recent sales. Far from panic, I think the numbers show that the Toronto market is liquid and remains healthy.
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