I was pleasantly surprised to see that the Toronto Real Estate Board reported 4,019 residential transactions in January 2018. Honestly, I thought the number would be much lower due to many buyers purchasing in December to take advantage of the old mortgage qualifying rules.
This type of market shows how strong the demand for housing is, and the price drop that buyers have been hoping for does not appear to be coming given the strong demand. The average price dropped in January, but not because prices fell, but because almost half of the sales in January were condominiums and townhouses, a lower average cost. In fact, it turns out that the market is robust, with one selling per 3 listings on average, and well-priced property selling quickly with multiple offers.
The statistics for the first three months of 2018 will be down compared to the record-setting numbers experienced a year ago, but don’t be fooled. As we progress into 2018, the prices will sound better, and buyers will get excited and jump into the market, perhaps raising selling prices higher than the 5%-6% I am predicting! The pace of home sales will also pick up, as the psychological impact of the Fair Housing Plan starts to wane and home buyers find their footing relative to the new stress test for mortgage approvals through federally regulated lenders.
The condominium market continues to be strong, and we will see continued price increases in that area for some reasons. One is that the price range that many can afford, two, we have a massive shortage of rental units, and condominiums fill that demand, and three, rental rates continue to increase, making condos an even better investment.
While it will be another healthy year for real estate in Toronto, right agents, those experienced, knowledgeable and committed to looking after their clients best interests will do better for their clients. That is where I come in. If you know of someone who is looking to buy or sell, please give me a call, I promise to look after their needs extra well!
Have a great rest of February!
Your Friend in Real Estate.