Toronto

Toronto Condo Sales Fall To 2013 Levels, Prices Hit A New All-Time High

Toronto real estate is seeing lower sales, but that didn’t stop condo prices from moving higher. Toronto Real Estate Board (TREB) numbers show the price of condo reached a new all-time high in December. Rising prices in Toronto came with the fewest sales for the month since 2013.

Toronto Condo Prices Rise Over 8%

Greater Toronto condo prices reached an all-time high, according to the “benchmark” index. TREB reported the price of a typical condo apt reached $509,700, up 8.96% from last year. The City of Toronto benchmark reached $541,000, up 10.21% from last year. A good portion of that increase was do to an abrupt increase in December. Note the last part, because we’ll come back to it.

Toronto Benchmark Condo Price

The price of a “typical” condo apartment in Toronto.

Source: CREA, Better Dwelling.

The benchmark’s annual pace of growth is still very high, but is tapering. Both TREB’s annual growth of 8.96% and the City’s 10.21% are lower than the month before. That said, the growth rate is still very, very high. Between 2012 and 2016, inflation adjusted growth had only been between 0 and 6%. So we’re still running hot on in this segment.

Toronto Benchmark Condo Price Change

The annual percent change of price, for a “typical” condo apartment in Toronto.

Source: CREA, Better Dwelling.

Toronto Condo Median Sale Price Rises Over 8%

The median sale price of condo apartments also saw significant climbs. TREB’s median sale price reached $485,000 in December, up 8.68% from last year. The City of Toronto reached $525,000, up 11.11% from last year. Remember, a median sale price means half of condos sold above this number, and half below. More than half of units are selling more than 5% below the benchmark price.

Toronto Median Condo Sale Price

The median sale price of a condo apartment in Toronto.

Source: CREA, Better Dwelling.

Toronto Condo Average Sale Price Rises Over 9%

The average Toronto condo sale price made a huge climb. TREB reported an average sale price of $554,497 in December, up 9.9% from last year. The City of Toronto average sale price reached $594,381, up 11.4% from last year. This number has been sliding for the past 3 months, but did not fall as much this December as it did last year. That resulted in the unusually high growth rate, but a falling average over the past 3 months. Remember, an average sale price isn’t a good indicator of how much you’ll pay. Instead it’s a better indicator of the market’s dollar flow.

Toronto Average Condo Sale Price

The average sale price of condo apartments in Toronto, and the suburbs.

Source: CREA, Better Dwelling.

Toronto Condo Sales See Slowest December Since 2013

Toronto condo sales made a huge decline, landing at a multi-year low for a December. TREB reported 1,185 sales in December, down 23.4% from last year. The City of Toronto represented 848 of those sales, down 23.9% from last year. December is usually a slow month, but this is the slowest December since 2013.

Toronto Condo Sales Vs. New Listings

The number of condo sales, vs newly listed condos per month in Toronto.

Source: TREB, Better Dwelling.

Toronto Condo Inventory Falls Over 10%

The number of new listings for condos made a big drop from last year. TREB reported 1,153 new condo listings in December, down 26.97% from last year. The City of Toronto represented 803 of those new listings, down 25.99% from last year. The drop in new listings helped to drag total inventory lower as well.

Active listings, the total number of listings for sale dropped. TREB reported 2,351 active listings in December, down 10.5% from last year. The City of Toronto represented 1,502 of those listings, down 10.22% from last year. The number of active listings declined on an annual basis, but are higher than December 2016.

Toronto Active Condo Listings

The number of condo listings available for sale in Toronto.

Source: TREB, Better Dwelling.

Toronto condo sales fell faster than inventory, sending the sale to active listings ratio (SALR) lower. The SALR across TREB reached 50.4 in December, down 15.23% from last year. The City of Toronto was higher at 56.45, but down 16.04% from last year. Both of these ratios are still very high, indicating strong demand relative to inventory. However, the declines in ratio explain why growth rate has been cut in more than half. Although once again, the growth rate is very high.

Toronto Condo Sales To Active Listings

The ratio of condo sales to active listings in Toronto. The higher the ratio, the more pressure on prices to increase.

Source: TREB, Better Dwelling.

Toronto condo prices reached a new all-time high by benchmark, which uses quantitative and qualitative measures. However, more than half of condos are being sold at a significant discount to this number, as indicated by the median. Some condo agents argue the benchmark is slow to respond, which makes the abrupt monthly jump all the more interesting. If the average and median sale price have been slipping lower, is the bench jump the start of a new run, or a lagging statistical anomaly?

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14 Comments

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  • Reply
    John K 7 months ago

    I keep hearing volume and prices are tied, but I don’t understand. Can someone explain how falling volume means prices could drop? Thanks in advance.

    • Reply
      Trader Jim 7 months ago

      Less sales mean less market validation. Just a few people are giving the stamp of approval higher, which is what makes it more likely to be a bubble. High price growth on high volume means more market approval for prices to move higher.

      Stocks have the same issue. Even if “tight” inventory is the reason people are bidding it up, doesn’t mean the market can/will absorb higher movements. Examples, tulips, dot com bubble, bitcoin, etc.

      • Reply
        Dewey 6 months ago

        The demand determines the price, not the trading volume. The temporary fluctuation of the price will lead to the decrease of trading volume, but it does not represent a bubble. Technical analysts are always good at explaining short-term fluctuations, but only very few people get rich with their theories.In the long run, supply is insufficient relative to demand, and the government has taken the wrong restrictive policy, further distorting the market, further accumulating the potential for price increases and increasing the risk of rapid future increases.

  • Reply
    Obi 7 months ago

    Row houses in d/t Toronto are going for a similar price. Who are these condo owners buying this junk at this pace? Remember, in the 1990s, condo prices dropped 50%, which is why we conveniently don’t have any stats for those years, just old archive papers and the reminiscence of old people explaining how they lost a near fortune.

    • Reply
      Joseph 7 months ago

      Where those condo investors will start feeling the pinch is the condo fees. Someone has to eat those costs. Condos, when initially purchased, have artificially low condo fees. As I have never seen a condo development not have artificially low condo fees for the first few years, I’ll assume it’s always the case. Unfortunately, the years following the first few, the costs associated with planning for future repairs/servicing have to get accounted for. Afterall, you need to protect your shelter, no? Plus the owners of the condos at the current time/future have to make up for the early “discount” the initial owners had with their condo fees. It’s a bad cycle once it gets started. The increase in condo fees for all the condos built within the last 3-4 years should be kicking in shortly as the condo associations figure out how little has been collected. Maybe that was changed within the Protecting Condiminium Owners Act, 2015 here in Ontario. But I haven’t heard of that happening yet. Or maybe it’s simply too leniently written to be enforced (to collect proper amounts within the first few years). High condo fees scare away potential buyers.

      Needless to say, to me, based on the shoddy building of quite a few Toronto condos (windows falling, walls falling, etc) and the soon to be higher than expected condo fee increases for these newer condos, I wouldn’t want to be caught with one of these things when the party ends. High condo fees + minimal building standards = not a good future for many condos for selling purposes.

      • Reply
        Q 7 months ago

        Not in total agreement with your comment.

        1) Some buildings have a large tick up due to bad management of the condo or incur large unexpected costs, but can’t say all condos in the 3 – 4 year range will have a huge uptick.

        2) If condo fees increase based on inflation, presumably your rent will also increase along with it.

        • Reply
          Joseph 7 months ago

          1) Fair point. I was rounding up.

          2) If 1) doesn’t happen to all, then you are correct. But the many I have seen, the uptick will happen/has already happened.

          I think an interesting project could be done to see sales between condos with high fees versus those with low fees. Maybe they shouldn’t even be put in the same boat, but separated.

  • Reply
    CanadaSucks 7 months ago

    Toronto Benchmark Condo Price Change is a another exponential. Price benchmark collapse as the curve is pointing toward the sky.

    We need a revision of the so called modern economical theories. Inflation is not a way to create long term wealth.

    https://en.wikipedia.org/wiki/Exponential_growth

  • Reply
    Gregory 7 months ago

    a 2000 sqft Rosedale Condo just sold yesterday

    714-20 Scivener ( sub PH) Square

    LP: $2,950,000
    SP: $3,950,000

    A cool million over ask ! So that’s $2000 psf

    It’s making Lanterra’s Uber Luxury 50 Scollard at $2600 a foot seem more feasible now.

    • Reply
      Mortgage Guy 7 months ago

      Underpricing still impresses people? Agents should start listing at $1, so a typical condo always goes at 560,000% over ask.

      At $2,000 psf, Toronto would cost as much as NYC. At which point if you’re the kind of person can pay those bills, you should be moving to NYC to get a 70% increase in salary. Cities only work as long as people don’t get frustrated with the salary to cost differential.

      The last time Toronto condos became as expensive as NYC was 1989. A 40% correction occurred shortly after in the condo market.

      • Reply
        Gregory 7 months ago

        This is one of the most expensive buildings in the City, top buildings in NYC are well over $5000 USD a foot and can approach $10k

        Average Mahattan Resale Condos $1500 USD psf
        Average Toronto Dwtn Resale $950 Cdn

    • Reply
      Bluetheimpala 7 months ago

      I’m uber busy and stressed to EFF with a bunch of things but I live and die by comparables and my brain said ‘hey cholo…you need look into this, seems like a fugazi!’ so my hands are typing.
      something didn’t make any sense with the near $4M you mentioned for a condo (which I assume has $1000+ maintenance) in a market where housing is between $3-8M soooo I jumped on realtor.ca and while I don’t care to track down this listing via the MLS, something doesn’t make a heck of a lot of sense when you can get the following:

      https://www.realtor.ca/real-estate/19998258/5-1-bedroom-single-family-house-152-roxborough-dr-toronto-rosedale-moore-park

      https://www.realtor.ca/real-estate/19446143/4-bedroom-single-family-house-245-rosedale-heights-dr-toronto-rosedale-moore-park

      https://www.realtor.ca/real-estate/20253660/3-1-bedroom-single-family-house-64-castle-frank-cres-toronto-rosedale-moore-park

      So sure, if I find the listing it could be like shangri-la and the garden of eden mixed together with the best strip club in atlanta buuuutt I highly doubt it is that nice. That castle frank estate is $850 less…I guess some people really like communal spaces? Could be a downsize from lawrence park or something but I ain’t buying it. Prices seems weird. Inventory is coming online. Will have to see if there is a recession. I bought so I’m coming along for the ride peeps! Wooohooo! Tock. BD4L.

      • Reply
        John 7 months ago

        $10,700 taxes
        $1682 maintenance

        Condo looks awful to me, not quite sure why someone would pay $4 Million… unless it is a transfer of wealth scheme.

      • Reply
        rustinpeace 7 months ago

        That unit isnt great. I live close to it. The train goes right by it and shakes building often. The area is nice. My thoughts are one of two things. Rose dale homeowner downsizing but still wnats to live in the same area, or foreign buyer money

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