Toronto

Toronto Real Estate Prices Soar As Sales Come In Higher Than New Inventory

Toronto real estate prices had an explosive end to the year. Toronto Real Estate Board (TREB) numbers show prices made a big jump in December. The increase was due to an unusually tight market, that saw a big increase in sales and drop in inventory.

Toronto Real Estate Prices Rise Over 7%

The industry’s benchmark shows the price of a typical home made a big leap. TREB reported a benchmark of $819,700 in December, up 7.26% from last year. The City of Toronto benchmark reached $907,200, up 7.37% from last year. Condo prices were the bulk of the gains, rising nearly double digits.

Greater Toronto Benchmark Price

The price of a “typical” composite home across Greater Toronto.

Source: TREB. Better Dwelling.

The 12-month rate of growth is seeing fast acceleration. The 7.26% increase in December is the seventh consecutive month of growth for TREB. The rate is now the highest its been since November 2017. Yes, we’re going back to pre-B-20 Guideline levels of price growth.

Greater Toronto Benchmark Price Change

The annual percent change of TREB’s benchmark price for all home types.

Source: TREB. Better Dwelling.

The median sale price reflected even stronger growth, as more luxury was in the mix. TREB’s median sale price reached $721,000 in December, up 10.41% from last year. The City of Toronto hit $720,000, up 12.5% from last year. A couple of things to note on this one. First, the median sale price is 12% lower than the “typical” price across TREB, and 20% lower in the City. This means more than half of the homes sold were lower than that price point. Second, the difference between the median in the suburbs and the city is almost negligible. That’s odd, to say the least.

The average sale price reflected the surge of luxury buying last month. TREB reported an average sale price of $837,788 in December, up 11.68% from last year. The City of Toronto average reached $885,132, up 16.06% from last year. The average isn’t adjusted for quality or size, so it’s best to use this as an indicator of dollar flow.

Greater Toronto Average Sale Price Change

The annual percent change of the average sale price of all homes.

Source: TREB, Better Dwelling.

Toronto Real Estate Sales Rise Over 16%

Toronto real estate sales made a huge jump from last year. TREB reported 4,399 sales in December, up 16.34% from last year. The City of Toronto represented 1,673 of those sales, up 13.57% from last year. The big growth is a little less impressive when you realize last year was unusually slow. TREB sales are 9.78% lower than the year before, and it was the second slowest December in the past half decade. This makes it unclear if the increase in sales volume is a ramp up, or demand pushed forward from the year before.

Greater Toronto December Home Sales

The total home sales across TREB by year, for the month of December.

Source: TREB, Better Dwelling.

Toronto Saw An Inventory Squeeze In December

The number of new listings was an important indicator last month, since they were so scarce. TREB reported 3,531 new listings in December, down 18.03% from last year. The City of Toronto represented 1,352 of those new listings, down 5.18% from last year. The number of new TREB listings was smaller than the number of sales, whittling away at inventory.

Greater Toronto Sales To New Listings

The number newly listed units per month, in contrast to sales.

Source: TREB, Better Dwelling.

Normally when this ratio is above 60%, prices are pressured to move higher. The ratio for December was 125%, so the price movement isn’t exactly a mystery. This is the first time it’s been above 100% since December 2016.

As previously mentioned, fewer new listings hacked away at total inventory. TREB reported 7,406 active listings in December, down 35.21% from last year. The City of Toronto represented 2,352 of those listings, down 28.07% from last year. All of Greater Toronto is seeing inventory disappear quickly, but the suburbs are seeing it vanish a little faster.

Greater Toronto December Active Listings

The total of active home listings across TREB by year, for the month of December.

Source: TREB, Better Dwelling.

December was definitely a squeeze on inventory. Demand pushed forward from B-20 Guidelines is starting to materialize, sending sales volumes higher. This is meeting with fewer sellers, many waiting to capture the new money the government pumped into the market. Now prices are back to pre-B-20 levels of growth, although December and January are low volume months. Low volume months are prone to big swings to the positive or negative.

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28 Comments

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  • Reply
    Dave M 6 months ago

    If it’s pull forward, low inventory price bump will be apparent by March.

  • Reply
    Boomer 6 months ago

    TREB’s franken numbers. Typical home is 20% above median? So like 70% of buys are below typical? Oh, okay TREB.

  • Reply
    Asterix1 6 months ago

    Does anyone here actually believe these TREB/CREA/TERANET/NB numbers?

    Its complete nonsense! Price are going down in GTA for the past while and will keep falling. It is ridiculous to see G&M/BNN/TStar and all others outlets printing this nonsense like its the truth.

    GTA RE is sinking, taking water, the only people left on board are the RE agents., captained by the RE boards.

    • Reply
      Brad 6 months ago

      I’m bearish long term on Canadian real estate… but you must be extremely desperate if you actually believe that the prices have been going down as there has been a steep incline since the bond market pushed fixed rates sub 3%

      • Reply
        Asterix1 6 months ago

        My apologies for the confusion. I am not denying that Average prices are going up in GTA. The reports that I am getting clearly show that prices have been dropping when you compare apples to apples.

        Also doing my own research on House Sigma, its easy to see where prices are going (down) when you compare resell prices. All the info is there (for free), RE boards must be hating it that we have access to this!!

        Prices can be falling overall, even if the Average goes up. Reports are interesting as they show the importance of analyzing the sales mix in a given period.

  • Reply
    SH 6 months ago

    Might this be fallout from the Hong Kong situation? Markham prices have exploded.

  • Reply
    SH 6 months ago

    Interesting that amidst condo prices going into the stratosphere, something virtually unreported is the fact that rents have stabilized in Toronto over the past year and even trending ever so slightly downward for bachelors and 1-bdrm. Tons of nice units sitting for months on Bungol and other sites, many with price drops. I’m not really sure what this all means. I guess enough new rental units finally coming online to accommodate population growth while FOMO driving a subset of that growing population into ownership and investment properties thereby pushing up prices.

  • Reply
    Rustem 6 months ago

    I am investing in crytpocurrency. It is now a safer investment than real estate in Toronto.
    where are all the bears? this website is going to shut down soon without them.

  • Reply
    maple 6 months ago

    hahahaha where are all the bears huh?

    • Reply
      Trader Jim 6 months ago

      Rolling in cash, because the credit bubble and lower growth is slaughtering CAD again?

  • Reply
    John 6 months ago

    I’ll reserve judgement for Jan/Feb numbers.

    December has shown a traditionally variant ratio.

    • Reply
      Sophia 6 months ago

      Definitely , due to the low inventory and greedy real estate agents, bidding wars are ending with sales 50/60/70K over asking price. Terribly townhouse in Oakville was sold for 70 k more in one week..so baseline for the next townhouse on the same street has been defined and the show goes on and on..until all local people are broke. Just do the math and calculate the mortgage with 5% for 500k condo, then check average salary in GTA and figure out who can afford it. If this continues , yonge people will start leaving the country or become homeless.
      I am wondering what is the percentage of properties bought by foreign investors in last 10 years ?Is it OK that Canadian children who finished expensive Canadian universities with high student debts rent small shoe box from the Chinese foreign investors for 3000$ , are we in Canada or in China, Hong Kong or South Korea?..will Canadians awake and realize what is going on in their country

      • Reply
        Brad 6 months ago

        There are a ton more baby boomer investors than foreign investors, but don’t want to place the blame there where it belongs.

      • Reply
        SH 6 months ago

        Young people voted overwhelmingly for the Trudeau Liberals which means more mass immigration, more globalist policies that put Canadians’ interests last, and more “foreign investment” (money laundering) in real estate. Next time a young person complains about house prices, ask who he or she voted for.

      • Reply
        Asterix1 6 months ago

        Sold over asking prices mean zero. Says nothing about a market since RE agents will unrealistically low ball initial prices to get to say tha tthey sold over-asking.

        What is the address of that townhouse that sold? Check on House Sigma for historical data on the property.

        • Reply
          Sophia 6 months ago

          I have seen the townhouse, looks terrible. I checked House Sigma and I know what was sold on the same street. All it takes is greedy real estate agent and buyer willing to pay such prices due to low inventory.

          • Joe 6 months ago

            no need to put greedy in front of real estate agent, thats a given.

    • Reply
      Trader Jim 6 months ago

      It’s too complicated to explain price movements in low volume sales to people. Better to just short CAD for the next two months, since households will scramble to inflate the credit outstanding.

  • Reply
    CanadaSucks 6 months ago

    There is no real economy in Canada. Manufacturing sector , natural resources extraction (oil, wood) are getting smaller and smaller and dying. The only way people can survive and hope to make some income is to bit up prices of houses and extract equity from it as revenu.

    20% carbon tax is now killing grains producers in Sask.

    • Reply
      CanadaSucks 6 months ago

      Youtube video about carbon tax kill food produces in Sask.

      Canada’s Carbon Tax At Work: Final Straw for Agriculture?

    • Reply
      Trevor 6 months ago

      Which doesn’t even begin to cover the amount of subsidies that go into the energy she bought. The problem isn’t the carbon tax, it’s that we subsidize then take the subsidies back through taxes. Energy should be free market.

      • Reply
        CanadaSucks 6 months ago

        My point is the you cannot increase operating cost by 22% overnight. There is consequences to that. This is too big of increase to absorb. Carbon tax is now causing inflation on top of inflation already generated by printing money. Carbon tax is now destroying the manufacturing and agricultural base of Canada.

  • Reply
    LoL 6 months ago

    http://housingbubble.blog/
    Interesting read,more informative than bd.

  • Reply
    Herry 6 months ago

    Greed, greed F ing greed !!!!!

  • Reply
    Sophia 6 months ago

    Unfortunately, the property prices will not go down any time soon.
    Canada will become country of rich immigrants.
    Children born in Canada will rent all their life unless they have rich parents to help them buy property or inheritance …or they will leave the country for better opportunities somewhere else.
    All condos in downtown Toronto in 5/6 years will be over 1m (including 1 bedroom).
    The current situation on the market for properties below 1M is similar to 2017, bidding war and sales over asking price. The properties above 1M are for rich people and we have enough of them to buy those. People who can’t afford to keep the house will sell the house to rich foreign investor and rent it from the same one .
    If you are hoping for the market crash , you can hope next 10 years , it will not crash unless we have World War III.
    Government doesn’t care if Canadians can’t afford to buy a house, it is a global market and in the global market there are enough people who can afford a house in Canada.
    Young people are too busy playing video games and staring at their phone to realize what happened in their country.

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