Inventory was limited this October. The number of active listings dropped nearly 19% compared to the year before. Meanwhile, GTA sales jumped 14%. The increased activity coupled with decreased supply tightened the market and pushed prices up. The average price of a home rose 5.5% to $852,142, which is the highest this year, but still significantly below April 2017’s record average price of nearly $921,000… thank goodness!
It’s worth noting that the number of sales, while a large increase from last year, is just 0.25% below the 5-year median for the month. So what could be interpreted as a “boom” is perhaps better described as a step towards normal.
In any case, the current situation prompted a warning from the regional real estate board that prices may be on the rise. On the flip side, Canada Mortgage and Housing Corp. (CMHC) released its fourth-quarter Housing Market Assessment a few weeks ago. In it, they downgrade the risk of overvaluation – where home prices exceed income levels by an excessive amount — from moderate to low. Likewise, Canada’s national housing agency has moved the Toronto market from the high-risk red zone into the moderate yellow area for the first time since 2015! Everyone’s got an opinion, so it’s best to consider real estate transactions on a case-by-case basis.
As we approach the holiday season, the market will slow down. In the meantime, November has been busy. There is plenty of inventory and November sales align nicely with a closing date for a fresh start to the New Year.