If you’ve taken even a passing interest in the Toronto real estate market during COVID, you probably have read a few headlines about the condo market and it’s supposed “crash.” I have had many conversations with fellow agents of very high inventory numbers and believed that this was likely due to an investor flight in the condo market. But then, the Toronto Regional Real Estate Board released the condo statistics for the second quarter of the year (April/May/June) and it seems that we have all been duped. Numbers don’t lie. Think that we have a record number of new listings? Wrong. Think that sale prices are down? Totally wrong.
What is true, and what has likely been promoting the doom and gloom headlines, is that sales are way down. Condo sales in the GTA have dropped by 50.8% from the second quarter of 2019. However, new listings were also down by a whopping 21%. In Q2 (quarter 2) 2019, we had 11,114 new listings. Q2 2020 saw 8,717 new listings. This is the opposite of soaring inventory numbers. Here’s the biggest surprise: the average price for a condo in the GTA has risen by 5.1% on a year-over-year basis. That’s right, condo prices are, on average, trending upwards along with the rest of the housing market.
We are now well into the third quarter of the market and anecdotally, it does seem like inventory numbers are high. However, it is unclear at this point if this is a delayed response to the COVID shutdown and sellers who put off their plans to list are now listing their condos. We will wait for the statistics to know what the list-to-sale ratios are in Q3. What is true is that if the rental market continues to soften, especially if immigration continues to decline and international students don’t come back to the city core in September, then the condo market will feel downward pressure. For now, though, with the statistics that we have in hand, the condo market is doing just fine.
— Robyn Vander Vennen, The Kim Kehoe Team.
