Toronto Condo Market Report • August 2021
Sales in July continued to slow from the previous month in Toronto. TRREB reported 9,390 sales, down 15% from July and June of last year. On the other hand, July sales were the biggest since 2016 for the month. Looking forward, I expect the number of sales in August to be even lower than July. The true test of sales activity will be in September when I expect sales to increase from summer levels.
With lower sales, most other markets would expect lower prices. Not in real estate. Most sellers prefer to take their listing off the market rather than reduce the price. The slow down in the current real estate market is from a lack of listing product. One of the key metrics is the ratio of sales to new listings in July. Anything above 60% is a ‘sellers’ market. We are at 75%. In fact, new listings in July were the lowest in the past 6 years.
When you look at the condo market, July sales were 8% higher than for July of last year and were down only 7% from June. The condo market, which under performed the overall market in 2020, is now outperforming the market this year. At the same time, new listings this July are down by 21% from this time a year ago. With a sale to new listing ratio of 62%, it suggests that there may be more opportunities for buyers in this segment.
The downtown condo market has also rebounded along with the overall condo market. Sales are 10% higher than a year ago and the sale to new list ratio has improved to 59%. More significantly, active listings in 2021 are now down over 35% from a year ago. Inventory is shrinking quickly as people are preparing to return to living downtown, and those who have moved out of town need some sort of accommodation if their employer wants them to work out of the office.
SALES-TO-NEW LISTINGS
When the sales-to-new listings ratio moves higher, average annual per cent change in home prices generally trends higher. When the sales-to-new listings ratio moves lower, average annual per cent change in home prices generally trends lower.
Source: Toronto Regional Real Estate Blog
RESALE VERSUS PRE-CONSTRUCTION CONDOS
RENTAL COMMENTARY
FAST FACTS:
33% of all condos in Toronto are in the rental pool.
The vacancy rate in Toronto is 1.7% (versus 905 at .8%). Unchanged this year.
Multiple offers for rentals are already appearing as we await the September market. For tenants, it is not just who will pay the highest rent but more importantly, who is the safest credit risk for landlords.
Note: Most units in Humber Bay Shores include parking which is not found in smaller units downtown. Also, Humber Bay units tend to be slightly larger.
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