Toronto Real Estate Sales and Trends by Zan Molko - September 2020
Real estate trends, statistics, september 2020
Even in this strangest of all years, there have been some surprises...or have there?
Toronto 11 October 2020. The fourth record month in a row. 11,083 homes sold, the highest volume ever, for a September. This is up +42.3% versus 2019. Following a record third quarter, sales through the first nine months of 2020 were up by approximately one per cent compared to the same period in 2019.
Since 1997, Toronto has been in a seller's market with the exception of two very brief periods. The first a few months in 2008 and again in 2017 for about 4 months. As long as we continue to have a shortage of inventory, prices will inevitably be headed upwards. There is no defeating the economic principle of supply and demand.
While the pandemic has wreaked havoc in the economy it has not yet been fully measured or accounted for.
Regardless of when we ultimately come out of the Covid 19 pandemic and the current challenging situation, there is little to suggest that we are even close to solving the housing shortage problem in the greater Toronto area.
So the biggest question remains "should I buy now when prices seem to be escalating beyond what is considered affordable for the average new home buyer?" And try to qualify for a mortgage while I still can?
Interest rates are at an all-time low. When they increase, and yes they will have to, as we try to one day recover from the current economy. The current buying power will decrease as interest rates increase potentially matching any decline in prices.
There are so many variables to consider and here is but one speculative example.
Interest rates increase from the current 1.75% to let's say 3.25% and prices decline by 10% in 2 years. In this example, you would have to earn 3% more to buy a home that cost 10% less.
An argument to buy now perhaps? Not, if you believe a sampling of the headlines
Toronto Condo Rental Inventory Is Soaring, and It Might Be Driving People To Sell - Better Dwelling
Toronto price growth continues to be among Canada's fastest - Mortgage Broker News Canada
Toronto Condo Prices Could Peak on Rush of New Listings -Yahoo! Finance
Toronto among cities most at risk of a housing bubble this year -Click Lancashire
Toronto Housing Market Sees Increase in Average Overvaluation Estimates: - CMHC
Swiss bank UBS says Toronto has the 3rd biggest housing bubble in the world - CBC News - Canada
Regardless of the pundits' opinions, this market is still driven by supply and demand. As long as the supply remains short and interest rates low, You know where prices are headed! The good news is that even in this type of market there are opportunities. You just may need help finding them. Let's start the conversation here.