Toronto

Toronto Real Estate Sales Surge Higher, But Fall Short of Typical

Greater Toronto real estate buyers are back to buying… sort of. Toronto Real Estate Board (TREB) numbers showed the price of a typical home jumped July. The increase came with a large increase in sales numbers, but still fell short of typical for the month.

Toronto Real Estate Prices Rise In July

The price of a typical home across Greater Toronto made a steep climb last month. TREB reported the composite benchmark reached $800,900 in July, up 4.43% from last year. The City of Toronto’s composite benchmark reached $886,500, up 5.64% from last year.  Both numbers are big climbs, especially from the month before.

Greater Toronto Benchmark Price

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

Source: Canadian Real Estate Association, Better Dwelling.

The annual rate of growth did make an abrupt climb, almost moving vertically. Most of it is explained by a lack of seasonal decline in 2019, compared to previous years. Over the past two years, the composite benchmark has made a seasonal decline in July. This year it did not, turning a monthly increase of just $2,400 into the largest 12 month gain since January 2018. Prices across Greater Toronto are down 2.49% from the all-time peak reported by TREB. Or down 1.83% from the adjusted benchmark published by the CREA.

Greater Toronto Benchmark Price Change

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

Source: Canadian Real Estate Association, Better Dwelling.

Greater Toronto real estate saw the average sale price increase last month. TREB sales had an average price of $806,755 in July, up 3.2% from last year. The City of Toronto hit $839,943, up 0.30% from last year. Suburban home prices are seeing the average climb much faster than the City.

Greater Toronto Average Sale Price Change

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

Source: TREB, Better Dwelling.

The median sale price is strangely the same in the suburbs and the City of Toronto. TREB reported a median sale price of $705,000 in July, up 5.22% from last year. The City of Toronto median reached $705,000, up 6.81% from last year. This tells us that more than half of homes across TREB sold 11.97% below the benchmark price. In the City of Toronto, more than half of homes sold 20.47% below the benchmark. Uh… cool.

Toronto Real Estate Sales Make A Huge Jump, But Fall Short

Greater Toronto is seeing real estate sales head back towards normal, but it’s still not quite there. TREB reported 8,595 sales in July, up 23.47% from last year. The City of Toronto represented 3,110 of the sales, and is up 20.82% from last year. This is a huge leap towards getting back to typical volumes for the month. However it still fell 6.09% short of the 5 year median average of sales for the month.

Greater Toronto April Home Sales

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

Source: TREB, Better Dwelling.

Inventory Falls Across Greater Toronto, Especially In The 905

The number of new listings to hit the market bumped higher last month. TREB reported 14,393 new listings in July, up 3.78% from last year. The City of Toronto represented 4,762 of the new listings, an increase of 5.56% compared to last year. The number of new listings increased, but still fell short of the rise in sales. This caused total inventory to drop.

Greater Toronto Sales To New Listings

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

Source: TREB, Better Dwelling.

The total number of listings for sale, or active listings, dropped across the board. TREB reported 17,938 listings in July, down 9.05% from last year. The City of Toronto represented 5,265 of those listings, down 3.90% from last year. Suburban inventory is dropping faster than inventory in the City.

Greater Toronto April Active Listings

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

Source: TREB, Better Dwelling.

Greater Toronto real estate sales made a big jump from last year, getting demand closer to normal. It still isn’t quite there, yet. It’s also worth remembering as new builds get cancelled, some buyers will opt for resales. Considering the number of cancellations recently, a portion of demand is likely rehashed.

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15 Comments

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  • Reply
    Marc 2 months ago

    Nice catch with the cancelled project. Does anyone know how many units and how this impacts prices? Because they applied pressure to force prices higher. The sales get cancelled, then they apply more pressure?

    • Reply
      Jin 2 months ago

      Cancelled units off the top of my head were 2,500 this year, and 4,700 this year. Very curious number if you think about it. If you subtract cancelled projects from YTD sales, they drop below last year’s YTD sales.

      • Reply
        Ethan Wu 2 months ago

        Any mortgage brokers have insights here? Are about 1 in 5 people from cancelled projects?

        I imagine some demand is pulled forward, but a good chunk of those cancelled sales were probably investors that didn’t seek a resale.

    • Reply
      Ethan Wu 2 months ago

      The pressure to move prices higher highlights it’s not a fundamental price climb, because prices remained elevated even after they were removed. The marginal manipulation still remains however.

      The slang term is gapping. Gaps usually fill, as in prices regress to the gap and fill demand at that price point. Prices correct to fundamentals. Fundamentals don’t correct to prices. lol.

  • Reply
    GTA Landlord 2 months ago

    I will say Realtor friends are saying it’s a lot busier than it has been. Of course, most of these guys have a short-term memory. Only the old timers seem to remember things picked up in the early 90s, before dropping off a cliff again shortly after.

  • Reply
    Poolio 2 months ago

    Uh… how does the benchmark sit 20% above the purchase price of more than half of homes? That’s a new one. We don’t even use the benchmark in Vancouver any more, it’s garbage.

    • Reply
      Pluto 2 months ago

      Hello — I think you’re referring to this: “In the City of Toronto, more than half of homes sold 20.47% below the benchmark.” They sit below — probably because these are sales of one-bedroom condos
      — much cheaper than the median of all types of detached houses, semi’s etc. I agree that with all these different home types the benchmark is a bit useless in urban markets.

  • Reply
    Jupiter 2 months ago

    Someone needs to investigate these numbers they are BS. I see first hand real numbers. The average sales price is 30% lower than these TREB numbers. Someone needs to investigate these wrong doings by TREB. this is wrong how they provide all these misleading numbers!

  • Reply
    Lurkosaur 2 months ago

    I think a significant portion of Vancouver RE investment monies are flowing to the GTA. That’s the only reason I can think of why these cities that were on a similar trajectory have diverged over the last few months i.e. TO keeps going while Vancouver is sales are still affected.

  • Reply
    Enocho Banada 2 months ago

    I’ve been trying to sell a property for a few months without much success. Does anyone know how much perecntage wise, I should raise my asking price each month until someone is too scared not to buy it?

    • Reply
      Bluetheimpala 2 months ago

      This is funny. Tock. BD4L.

    • Reply
      hh 2 months ago

      if you are trying to sell your condo, you are pretty much out of luck. Lots of condo units are on the market for more than 30 days haha. oh and I think 5 % per month is a good number.

  • Reply
    Joseph 2 months ago

    I just want to point out something to those who speak of 1990 and how bad it got after that. Mainly to the young readers.

    I’m making an assumption here, but I feel it’s justifiable. In 1990, the internet had not become what it is today. Not everyone had a computer. Smartphones were science fiction.

    So when you look at graphs for the downward slope after 1990, expect it to be a lot smoother than it will be when things hit this time around.

    With instant knowledge at our hands these days, the downward slope is likely going to look spikier.

    I’m not saying this time is different. I’m just saying the tools currently at our disposal versus 1990 will alter the look of some data. An ability to react quicker to changes will cause higher highs and lower lows on the way down.

    I feel that’s what’s happening here.

  • Reply
    Chester Pape 2 months ago

    China is devaluing the Yuan and those hardworking employees of Foxconn- Apple manufacturing plants are parking their legit money into Toronto real estate, because Toronto= world class city.

    (sarcasm)

  • Reply
    Beh G. 2 months ago

    I didn’t see any positives in the latest release… in fact, if you ignore the fairy-dust laden “benchmark price” and look at average detached 416 prices, the pattern of lower highs and lower lows of a falling market has been established way beyond a reasonable doubt.

    May and June 2019 prices were lower than 2018 which themselves were lower than 2017 prices. Even more concerning should be the fact that July 2018 saw a bump up compared to 2017 but that small and rare beacon of hope was just shattered with the 9.1% drop last month compared to 2018 and a 7.9% drop compared to June 2019.

    Another 7.9% drop in August would establish a new low below December 2018 and a mere 2.5% drop would make August 2019 lower than 2017 when panic was the word of the day. In fact, average Toronto detached prices are now below May 2015 inflation adjusted prices – that’s 4 years of gains wiped out already!!!

    And that’s with BOC’s imaginary inflation numbers, not the real inflation in Toronto! In summary, what’s happening is the exact opposite of the industry spin and the headlines.

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