Since COVID-related closures and social distancing took effect in Canada, life as we know it has been put on pause within the city of Toronto. As one of the hottest real estate markets within Canada, many have speculated on the impact that the public health crisis will have upon this market. While it is impossible to make a definitive prediction of how Toronto’s real estate market will weather this storm, there exists a great deal of optimism that any COVID-19 impacts are expected to be temporary.
Below, we take a look at the pre-crisis market and current conditions within Toronto, to better understand the basis of the optimism, and why Toronto is poised to make a triumphant return as one of the country’s hottest real estate markets.
A Strong Start to the Year
In the first quarter of 2020, Toronto was gearing up for a spring market like no other. Demand heavily outweighed the supply of homes for sale within the Greater Toronto Area, and the aggregate price of homes was $866,211, a 7.5-per-cent year-over-year increase. These skyrocketing prices were most apparent within the condominium submarket, where values had shot up 8.8 per cent year-over-year.
Toronto Market Reaction to COVID-19
With social distancing measures imposed to prevent the spread of the virus, Realtors across the city, and the country, have been adjusting to a new normal for conducting real estate transactions. While the real estate industry was deemed an essential service and permitted to continue to function by the Government of Ontario, open houses came to a halt. In response, real estate agents have gotten creative, using interactive 360-degree tours, or live-video sessions to showcase homes to prospective buyers. When in-person tours must take place, agents are taking extraordinary measures to ensure the safety of their clients and themselves. It goes without saying, deals are no longer being sealed with a handshake.
The impact of COVID-19’s spread and social distancing measures upon the Toronto real estate market didn’t reveal themselves in the numbers until the second half of March. Going into March, in fact, the Toronto market was still on fire. According to Toronto Regional Real Estate Board (TRREB) statistics, sales volumes had climbed 49 per cent across the GTA compared to the same period in 2019. By the second half of March, the tables turned and home sales dropped 15.9 per cent compared to the same two weeks of 2019.
Home prices, however, remained strong by the end of the month, with the average sales price for March up to $902,680 – an impressive 14.5-per-cent spike over March 2019. RE/MAX brokers in some of Canada’s key housing markets agree that prices are expected to hold steady, at least for the next few months. Despite softening sales activity since the outbreak, those who have listed their homes on the market are well aware of the sales prices in February and early March, and thus are continuing to hold their price and wait out the current crisis, until the wave of demand returns. Panic sales – in which sellers price low to get their home off the market – has yet to be seen within Toronto.
Stable Market Balance
According to Jason Mercer, TRREB’s senior market analyst, the buyer-seller relationship has remained consistent throughout the outbreak, and this factor helps to explain why Toronto’s market may not be in trouble after all. While sales volume has dipped, so have listings. Since the levels have been following the same trajectory, it’s unlikely that the market will flip to resemble a buyer’s market anytime soon. Mercer confirms that there are still a similar proportion of buyers vying for each remaining listing, and as long as this trend continues, there will be little incentive for sellers to budge on their price points.
A Little Less Optimism for Toronto’s Landlords
COVID-19 has dealt a sharp blow to Toronto’s landlords, particularly those operating short-term rentals, who now find themselves over-leveraged and vulnerable. Many real estate investors were reaping the benefits of Airbnb-style short-term rentals, where the profit margin was so much greater than a traditional lease. With the closing of the US/Canada border and the imposed stay at home measures, the demand for short-term rentals disappeared overnight, and now some investors are left scrambling to find tenants for their vacant spaces.
Toronto’s pre-crisis vacancy rate was two per cent, making the process of securing an available unit an incredibly cutthroat process for hopeful renters. Toronto also took the top spot as the most expensive rental market in the country, with a one-bedroom unit averaging $2,213 in rent per month (April 2020 National Rent Rankings from Rentals.ca).
Since the closure of non-essential businesses across the city in late March, many tenants are struggling to make rent payments. This will inevitably put downward pressure on demand for a brief period of time, even after protection measures have been lifted. This extra supply flooding the rental markets, coupled with depressed demand levels, means there is potential for average rental rates to decline within the Greater Toronto Area. This anticipated drop in rent prices and competition may translate to a less stressful home search for new renters, post-crisis.
On the other hand, some experts are warning that we shouldn’t count on this rental price relief; it is possible that following the pandemic, some buyers who had put their purchasing plans on hold may be reluctant to jump back into the housing market, and may elect to rent instead. This may help to balance out any loss in rental demand, preventing any significant drops in average rental price.
So many of these potential outcomes are dependent on how quickly life within the city can return to a level of normalcy. Toronto is already starting to see the re-opening of businesses, and if everything unfolds as public health experts are forecasting, we can hope to see a slow return to activity within the Toronto real estate market by this fall. Once a sizeable portion of those who are temporarily unemployed are able to return back to work, consumer confidence will bounce back and the demand that has fuelled the Toronto housing market for so long, will resurface.
Until then, keep yourself and your loved ones safe, and sane. This too shall pass!
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
MONTREAL – The Quebec Professional Association of Real Estate Brokers says Montreal-area home sales rose 9.3 per cent in August compared with the same month last year, with levels slightly higher than the historical average for this time of year.
The association says home sales in the region totalled 2,991 for the month, up from 2,737 in August 2023.
The median price for all housing types was up year-over-year, led by a six per cent increase for the price of a plex at $763,000 last month.
The median price for a single-family home rose 5.2 per cent to $590,000 and the median price for a condominium rose 4.4 per cent to $407,100.
QPAREB market analysis director Charles Brant says the strength of the Montreal resale market contrasts with declines in many other Canadian cities struggling with higher levels of household debt, lower savings and diminishing purchasing power.
Active listings for August jumped 18 per cent compared with a year earlier to 17,200, while new listings rose 1.7 per cent to 4,840.
This report by The Canadian Press was first published Sept. 6, 2024.
In the quest to find cities where renters can enjoy the best of all worlds, a recent study analyzed 24 metrics across three key categories—Housing & Economy, Quality of Life, and Community. The study ranked the 100 largest cities in Canada to determine which ones offer the most to their renters.
Here are the top 10 cities that emerged as the best for renters in 2024:
St. John’s, NL
St. John’s, Newfoundland and Labrador, stand out as the top city for renters in Canada for 2024. Known for its vibrant cultural scene, stunning natural beauty, and welcoming community, St. John’s offers an exceptional quality of life. The city boasts affordable housing, a robust economy, and low unemployment rates, making it an attractive option for those seeking a balanced and enriching living experience. Its rich history, picturesque harbour, and dynamic arts scene further enhance its appeal, ensuring that renters can enjoy both comfort and excitement in this charming coastal city.
Sherbrooke, QC
Sherbrooke, Quebec, emerges as a leading city for renters in Canada for 2024, offering a blend of affordability and quality of life. Nestled in the heart of the Eastern Townships, Sherbrooke is known for its picturesque landscapes, vibrant cultural scene, and strong community spirit. The city provides affordable rental options, low living costs, and a thriving local economy, making it an ideal destination for those seeking both comfort and economic stability. With its rich history, numerous parks, and dynamic arts and education sectors, Sherbrooke presents an inviting environment for renters looking for a well-rounded lifestyle.
Québec City, QC
Québec City, the capital of Quebec, stands out as a premier destination for renters in Canada for 2024. Known for its rich history, stunning architecture, and vibrant cultural heritage, this city offers an exceptional quality of life. Renters benefit from affordable housing, excellent public services, and a robust economy. The city’s charming streets, historic sites, and diverse culinary scene provide a unique living experience. With top-notch education institutions, numerous parks, and a strong sense of community, Québec City is an ideal choice for those seeking a dynamic and fulfilling lifestyle.
Trois-Rivières, QC
Trois-Rivières, nestled between Montreal and Quebec City, emerges as a top choice for renters in Canada. This historic city, known for its picturesque riverside views and rich cultural scene, offers an appealing blend of affordability and quality of life. Renters in Trois-Rivières enjoy reasonable housing costs, a low unemployment rate, and a vibrant community atmosphere. The city’s well-preserved historic sites, bustling arts community, and excellent educational institutions make it an attractive destination for those seeking a balanced and enriching lifestyle.
Saguenay, QC
Saguenay, located in the stunning Saguenay–Lac-Saint-Jean region of Quebec, is a prime destination for renters seeking affordable living amidst breathtaking natural beauty. Known for its picturesque fjords and vibrant cultural scene, Saguenay offers residents a high quality of life with lower housing costs compared to major urban centers. The city boasts a strong sense of community, excellent recreational opportunities, and a growing economy. For those looking to combine affordability with a rich cultural and natural environment, Saguenay stands out as an ideal choice.
Granby, QC
Granby, nestled in the heart of Quebec’s Eastern Townships, offers renters a delightful blend of small-town charm and ample opportunities. Known for its beautiful parks, vibrant cultural scene, and family-friendly environment, Granby provides an exceptional quality of life. The city’s affordable housing market and strong sense of community make it an attractive option for those seeking a peaceful yet dynamic place to live. With its renowned zoo, bustling downtown, and numerous outdoor activities, Granby is a hidden gem that caters to a diverse range of lifestyles.
Fredericton, NB
Fredericton, the capital city of New Brunswick, offers renters a harmonious blend of historical charm and modern amenities. Known for its vibrant arts scene, beautiful riverfront, and welcoming community, Fredericton provides an excellent quality of life. The city boasts affordable housing options, scenic parks, and a strong educational presence with institutions like the University of New Brunswick. Its rich cultural heritage, coupled with a thriving local economy, makes Fredericton an attractive destination for those seeking a balanced and fulfilling lifestyle.
Saint John, NB
Saint John, New Brunswick’s largest city, is a coastal gem known for its stunning waterfront and rich heritage. Nestled on the Bay of Fundy, it offers renters an affordable cost of living with a unique blend of historic architecture and modern conveniences. The city’s vibrant uptown area is bustling with shops, restaurants, and cultural attractions, while its scenic parks and outdoor spaces provide ample opportunities for recreation. Saint John’s strong sense of community and economic growth make it an inviting place for those looking to enjoy both urban and natural beauty.
Saint-Hyacinthe, QC
Saint-Hyacinthe, located in the Montérégie region of Quebec, is a vibrant city known for its strong agricultural roots and innovative spirit. Often referred to as the “Agricultural Technopolis,” it is home to numerous research centers and educational institutions. Renters in Saint-Hyacinthe benefit from a high quality of life with access to excellent local amenities, including parks, cultural events, and a thriving local food scene. The city’s affordable housing and close-knit community atmosphere make it an attractive option for those seeking a balanced and enriching lifestyle.
Lévis, QC
Lévis, located on the southern shore of the St. Lawrence River across from Quebec City, offers a unique blend of historical charm and modern conveniences. Known for its picturesque views and well-preserved heritage sites, Lévis is a city where history meets contemporary living. Residents enjoy a high quality of life with excellent public services, green spaces, and cultural activities. The city’s affordable housing options and strong sense of community make it a desirable place for renters looking for both tranquility and easy access to urban amenities.
This category looked at factors such as average rent, housing costs, rental availability, and unemployment rates. Québec stood out with 10 cities ranking at the top, demonstrating strong economic stability and affordable housing options, which are critical for renters looking for cost-effective living conditions.
Québec again led the pack in this category, with five cities in the top 10. Ontario followed closely with three cities. British Columbia excelled in walkability, with four cities achieving the highest walk scores, while Caledon topped the list for its extensive green spaces. These factors contribute significantly to the overall quality of life, making these cities attractive for renters.
Victoria, BC, emerged as the leader in this category due to its rich array of restaurants, museums, and educational institutions, offering a vibrant community life. St. John’s, NL, and Vancouver, BC, also ranked highly. Québec City, QC, and Lévis, QC, scored the highest in life satisfaction, reflecting a strong sense of community and well-being. Additionally, Saskatoon, SK, and Oshawa, ON, were noted for having residents with lower stress levels.
For a comprehensive view of the rankings and detailed interactive visuals, you can visit the full study by Point2Homes.
While no city can provide a perfect living experience for every renter, the cities highlighted in this study come remarkably close by excelling in key areas such as housing affordability, quality of life, and community engagement. These findings offer valuable insights for renters seeking the best places to live in Canada in 2024.
