TORONTO, April 22, 2020 (GLOBE NEWSWIRE) — Toronto Regional Real Estate Board President Michael Collins is reporting results for the first 17 days of April 2020, in order to provide some guidance on the impact of COVID-19 on the Greater Toronto Area housing market:
- Greater Toronto Area REALTORS® reported 1,654 home sales through TRREB’s MLS® System during the first 17 days of April – down by 69 per cent compared to the same period in 2019.
- Year-over-year sales declines, in percentage terms, were greatest for the detached and condominium apartment market segments. In the detached segment, the higher end of the market was particularly impacted in the City of Toronto. The condominium apartment segment has traditionally attracted a high share of first-time buyers, who in times of uncertainty can put their decision to purchase on hold.
- The number of new listings was down on a year-over-year basis by a similar annual rate, declining by 63.7 per cent to 3,843.
- The fact that new listings trended in a similar fashion to sales during the first half of April means that market conditions remained tight enough to provide support for the average selling price in line with 2019 levels.
- The average selling price for sales reported during the first 17 days of April 2020 was $819,665 – down by 1.5 per cent compared to the same period in 2019.
- Uncertainty about market conditions due to COVID-19 certainly played a role in moderating the pace of year-over-year price growth during the first half of April. The changing composition of home sales also played a role. In the City of Toronto, for example, the number of homes sold for more than two-million dollars declined more than overall sales. This also had an impact on the average selling prices.
- It should also be noted that selling prices have also followed listing prices, with average listing prices down by a similar amount. Average selling prices have not been noticeably lower than listing prices compared to last year. This is further evidence that the mix of homes listed has changed compared to last year.
“The state of emergency measures currently in place, including the necessary enforcement of social distancing, has impacted the real estate market in many ways. Home buyers and sellers have concerns about the economy and indeed their own employment situations. On top of this, many buyers and sellers are avoiding any type of in-person interaction. In the condo market in particular, individual condo corporations have curtailed entry for non-residents,” said Mr. Collins.
“All of the COVID-19 related issues and measures have translated into a temporary drop in the number of transactions – a drop that will persist until we experience a meaningful and sustained decline in the number of cases. However, once recovery begins, it will likely accelerate in earnest as buyers seek to satisfy pent-up demand that will build up over the course of the spring and at least part of the summer,” continued Mr. Collins.
“While the necessary social distancing efforts have certainly resulted in a substantial pause to housing transactions, it is possible that REALTORS® and their clients will be able to mitigate the impact somewhat through the use of technology. TRREB and its partner board and association Members can now take advantage of virtual open houses accessed through listing searches on TRREB.ca and REALTOR.ca. TRREB’s professional development staff are also holding virtual webinars on other ways REALTORS can leverage technology to help their clients in these challenging times,” said John DiMichele, TRREB’s CEO.
Looking forward, the decline in home sales will be likely strongest in Q2 2020, as strong social distancing measures remain in place for most of the spring. However, if public health forecasts assuming strong social distancing measures play out as expected, we will likely start to see improvement in market activity in the summer. Recovery will accelerate through the fall, as social distancing measures are substantially relaxed, a large number of people return to work from furlough and home buyers take advantage of very low borrowing costs that will remain in place to spur economic recovery.
The calendar year average price for 2020 will likely remain near the 2019 level, and will be buoyed by the 15 per cent year-over-year growth experienced in Q1 2020 and resumed growth in Q4. Year-over-year declines in home prices could be reported during some months in the second and third quarters, but these declines will have less of an effect on the overall price for 2020 because the annual share of sales will also be much lower than normal.
“As we recover from this temporary downturn, potentially later this year, home buyers will move off the sidelines in increasing numbers as they satisfy pent-up demand for ownership housing. Increasingly, these buyers will be faced with the persistent lack of listings inventory that was a serious problem before the onset of COVID-19. As the different levels of government look toward recovery, it will be important for them to resume and build upon initiatives to bring a greater diversity of housing supply on line,” said Jason Mercer, TRREB’s Chief Market Analyst.
Preliminary Market Outlook Guidance
|Area||Home Type||Sales||Sales Y/Y |
|New List. Y/Y |
|Avg. Price Y/Y |
|Avg. DOM||Avg. DOM – |
|Avg. SP/LP – |
|All TREB||All Home Types||1,654||-69.0||%||3,843||-63.7||%||$819,665||-1.5||%||17||19||99.1||%||99.4||%|
|Toronto||All Home Types||588||-69.7||%||1,381||-60.1||%||$885,371||-3.7||%||14||17||100.1||%||101.2||%|
|Halton||All Home Types||180||-68.4||%||390||-63.5||%||$866,485||-1.1||%||18||20||98.1||%||97.9||%|
|Peel||All Home Types||287||-74.8||%||750||-64.0||%||$777,707||2.2||%||15||16||98.9||%||98.6||%|
|York||All Home Types||252||-70.8||%||619||-72.1||%||$954,926||3.5||%||21||24||98.0||%||98.2||%|
|Durham||All Home Types||282||-55.4||%||530||-57.4||%||$611,125||-0.6||%||17||20||99.5||%||98.6||%|
|South Simcoe||All Home Types||56||-66.7||%||154||-66.7||%||$683,306||19.1||%||28||30||96.9||%||97.8||%|
|Orangeville||All Home Types||9||-73.5||%||19||-65.5||%||$523,922||-5.6||%||16||23||99.3||%||98.9||%|
|Summary of TREB MLS® Sales and Average Price|
|April 1 to 17, 2020|
|Sales||Average Price||New Listings||Sales||Average Price||New Listings|
|City of Toronto (“416”)||588||885,371||1,381||1,940||919,788||3,460|
|Rest of GTA (“905”)||1,066||783,422||2,462||3,403||782,628||7,135|
Mary Gallagher, Senior Manager, Public Affairs
The Toronto Regional Real Estate Board is Canada’s largest real estate board with more than 56,000 residential and commercial professionals connecting people, property and communities.
Despite the challenges, Edmonton area real estate values 'have held up extraordinarily well' – Edmonton Journal
I have to say the Edmonton area real estate market has surprised me.
When you consider the onslaught we have had in the past five years — oil price crash, more than 100,000 job losses, fires, floods, domestic and international trade disputes and then COVID-19, I would say the Edmonton and area real estate values have held up extraordinarily well.
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Since 2014, we’ve only seen modest declines in prices, with single family homes declining the least. Edmonton remains Canada’s most affordable major city with one of the highest average incomes.
Other Canadian cities have seen significant price gains in the same time period creating a bigger difference in real estate values between regions. We have had clients who can work anywhere and chose Edmonton as they can afford much nicer living quarters here for the same money.
Given the lower prices and interest rates combined with rising rental demand, it is easier for investors to get positive cash flows. We are seeing investors looking at condos for their positive cash flow. This fact will help to support our real estate values.
Toronto and Vancouver Real Estate Inventory May Get A Boost From AirBNB Slowdown – Better Dwelling
Canadian real estate markets may be getting another inventory headwind soon. National Bank of Canada (NBC) research estimates AirBNB hosts may contribute to oversupply later this year. As the slowdown impacts hosts, many may be incentivized to sell. By their estimates, just a quarter of hosts selling would cause inventory in cities like Toronto and Vancouver to swell.
AirBNB and Housing Inventory
AirBNB helps homeowners take existing housing stock and convert it to short-term rentals. Rather than staying in hotels, travelers can now stay in existing non-hotel stock. At first, it wasn’t a big issue when just a few people were doing it. As the platform expanded, people began buying additional housing just to operate short-term rentals. By repurposing housing that would otherwise be long-term units, cities now need additional housing. Basically, short-term rentals lead to an inventory squeeze, pushing rents and prices higher. Temporarily at least, for as long as the squeeze persists. That squeeze could end as quickly as travel did.
The Travel Industry Expects A Big Slowdown
The travel industry doesn’t expect travel to recover quickly from the pandemic. The US has approved some routes cutting plane traffic up to 90% until September. The IATA, the trade association for international airlines, also doesn’t see traffic returning to 2019 levels until at least 2023 – at the earliest. What does this mean? Fewer users of short-term rentals, and more competition from hotels for those travelers. All of this can have a big impact on real estate inventory, according to NBC numbers.
Canada’s Biggest Real Estate Markets May See Inventory Spike
If just a quarter of AirBNB inventory is sold off, NBC sees a lot more real estate listings on the market. In Vancouver, the bank estimates real estate listings would rise 12%. Montreal would see an increase of 27% in resale listings. Toronto is another story though, with inventory forecasted to rise a whopping 34%. That’s with just 25% of AirBNB exiting as hosts.
AirBNB Boost To Canadian Real Estate Inventory
The potential increase in real estate listings if 25% of AirBNB properties were listed for sale.
Source: National Bank of Canada, Better Dwelling.
The boost is another headwind for inventory rising later in the year. Inventory was already expected to rise in the coming few months. NBC economists believe this would be “exacerbating oversupply in the coming months.”
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How Is The Real Estate Market In Muskoka Post COVID19 – Hunters Bay Radio
In a brand new video podcast series, Gerry Lantaigne with Sutton Group – Muskoka Realty discuses the world of real estate in Muskoka during the Coronavirus pandemic.
Join Gerry every month as he updates you on The State of Real Estate
Watch the inaugural episode here:
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