2019 was a year of ups and downs for Toronto real estate. The “stress test” cooled the heat, while the lack of inventory fueled bidding wars and multiple offers on homes from $1.5MM and under. The year was anything but predictable. It started with continuous dumps of snow, yet it turned out to be my best quarter ever – I was lucky! The spring market took a bit of a hiatus and summer saw the housing market come back strong. All this to say that 2020 real estate might be unpredictable, or not…
What follows is the summary for the month of December, and those that led up to year-end.
The last quarter of 2019 saw a steady decline in the number of sales and new listings until the market fell off the cliff in December. Market activity in Central Toronto (C01-C04, C08-C12) was painfully slow. How painful? Well, there were only 444 new Central Toronto listings in December compared to 5492 in December, 2018. That’s a decrease of nearly 92% YoY! The number of sales was down by an equally shocking 82.3%. Despite the drop in supply, prices stayed flat.
Things were better in the GTA-at-large where the average price was up 11.9% YoY and the number of sales was up 17.4%. After a slow start to the year, many Toronto buyers returned from the sidelines in the latter half of 2019.
Looking forward, TREB’s Chief Market Analyst urges buyers to expect further price acceleration in 2020 if there is no relief on the supply front. Regardless of the fact that the rate of new developments in the GTA is nearly at an all-time high, it looks like we’ll be short on supply.
That said, the lack of current inventory means we’re in for a seller’s market. It’s conceivable that enough sellers will want to take advantage of near-record prices and Toronto’s residential resale market could produce year-end sales that surpass 2019.
For first-time buyers, now is a tough time to get in – the average home price is triple what the average millennial can afford. As for the high-end market, it’s hard to say. Many luxury real estate sales migrated to exclusive marketing platforms from the Multiple Listings Service (MLS). As such, the data has been inconclusive, however, it looks like the volume of sales above $4M went down and prices rose by 5%.
So far, 2020 has begun like 2019 ended – there are very few houses on the market. If your home is ready to go and you want to sell, my advice is to list now. How quickly it sells and for how much will ultimately be determined by the pricing strategy implemented by you and your agent.
I don’t expect to see an uptick until the spring market, at which point there will be more listings and you’ll be facing more competition from other sellers. However, in the past twenty years, demand during the spring market has, more often than not, surpassed supply and caused prices to increase.
If you’re buying, get the process started as soon as possible so you’re educated and ready to act on your dream home when you see it in the spring market, unless, of course, you find it during the winter months for a more affordable price. Score!
There really are no rules governing the market in Central Toronto. Every home, whether you’re buying or selling, presents a unique situation and requires an equally tailored strategy. For this, you need a highly skilled and experienced Realtor by your side. That’s where I come in. Together, we’ll navigate what I expect to be a busy 2020. If you have questions, don’t hesitate to reach out, I’m happy to share my expertise.