Toronto

What Stress Test? Toronto Real Estate Prices Make 4th Biggest Price Jump

Demand side measures don’t appear to be slowing down Toronto real estate buyers. Toronto Real Estate Board (TREB) numbers show home prices made the fourth largest jump for April. The abrupt increase was accompanied by an annual rise in sales, as well as inventory.

Greater Toronto Real Estate Makes Fourth Biggest Jump In April

The prices of a typical home in Greater Toronto jumped according to the board’s benchmark. TREB reported the benchmark price of all homes his $789,100 in April, up 3.17% from last year. The City of Toronto benchmark hit $873,800, up 5.15% from last year. The vast majority of the gains were a result of condo apartments seeing a steep rise.

Greater Toronto Benchmark Price

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

Source: TREB. Better Dwelling.

The benchmark is accelerating in the suburbs and decelerating in the city. TREB’s 3.17% annual pace of growth is higher than it was the month before, while the City’s 5.15% is lower. Month-to-month, this was the fourth largest increase for April in the history of the benchmark. Only 2015 – 2017 printed bigger monthly growth for the month. Technically speaking, stress testing had virtually nil impact according to these numbers.

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 is much more conservative than the benchmark price. TREB reported a median sale price of $685,000 in April, up 3.47% from last year. The City of Toronto median price reached $687,000, up 5.52% from last year. That means more than half of homes in TREB are selling 13.19% lower than the price of a “typical” home. In the City of Toronto, more than half of homes are selling 21.37% below the price of a “typical” home in the city.

The average sale price is making smaller gains. TREB reported an average sale price of $791,857 in April, up 1.59% from last year. The City of Toronto reported an average sale price of $850,341, up 3.39% from last year. The vast majority of the gains are due to the  increase for condo apartments, in both the suburbs and city.

Greater Toronto Average Sale Price Change

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

Source: TREB. Better Dwelling.

Greater Toronto Home Sales Are Up… Kind of

Homes sales across Greater Toronto are up from last year, but still weak from an overall picture. TREB reported 9,042 homes sales in April, up 16.8% from last year. The City of Toronto represented 3,234 of those sales, up 9.77% from last year. While higher than last year, this was the third fewest sales for the month of April in the past decade. Standard revisions of sales numbers typically lower sales by 20 – 40 units, which means its very likely to be revised as the second fewest. Over the past 20 years, the median number of sales for the month were exactly the same number of sales.

Greater Toronto April Home Sales

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

Source: TREB. Better Dwelling.

Inventory Is Rising In The City, Falling In The Suburbs

The number of new listings were up across Greater Toronto last month. TREB reported 17,205 new listings in April, up 5.72% from last year. The City of Toronto represented 5,734 of the new listings, up 8.2% from last year. The increase in sales had a bigger impact in the city than the suburbs.

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 homes listed for sale fell, but increased in the city. TREB reported 18,037 active listings in April, down 0.92% from last year. The City of Toronto represented 5,368 of those units, up 12.18% from last year. Total inventory is making a sharp climb in the city, but not so much in the 905. Total inventory printed the second highest number for April since 2014.

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 sales made a giant spike compared to last year’s drop, but are still much lower than usual. Inventory is rising, and is sitting closer to typical levels we’ve seen for the month. Even with relatively weak sales, prices moved higher according to the benchmark. In fact, the monthly increase is so high it is hard to argue demand side measures are having much of impact at all.

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30 Comments

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  • Reply
    rustinpeace 2 weeks ago

    bidding wars, bully offers are all back. Absolute garbage townhouse homes are selling for +1M and a bachelor apartment close to China town just sold for a cool 500k. Or the 2+1 in Rosedale that sold for 5.8M appreciating 2M in under 2 years. Not sure where all this money is coming from. My guess is that people flipping condos are taking their massive equity and up sizing.

    • Reply
      SUMSKILLZ 2 weeks ago

      My guess is we are seeing some of the flows that used to go to Vancouver. I’m also maybe seeing families who outgrew their small 416 condo shopping semis and towns in the 905. When you see more than one branded rental car at an open house…it makes you wonder.

  • Reply
    s2u 2 weeks ago

    sounds like Toronto has a money laundering problem

  • Reply
    NJ 2 weeks ago

    really treb? organised real estate fooling people for the sake of running their business. desperate!

  • Reply
    TMI 2 weeks ago

    Absurd boards are even allowed to release a benchmark price. It’s a six month average if I’m not mistaken. You know what that means?

    Statistically, you’re looking at an 8% hike from last month to this month for a such a sudden rise. Are people really out there paying 8% more than last month?

  • Reply
    Asterix1 2 weeks ago

    Why use the Benchmark price? Its a joke, brought to you by the RE industry!

  • Reply
    Dave 2 weeks ago

    Where will Toronto’s housing market head from now on? Is dirty money flowing in from Vancouver while it still can?

  • Reply
    Jon snow 2 weeks ago

    this is exactly what have I been saying for the past 1 month.

    its going to be a busy summer as buyers take advantage of the small dip in detach home prices over the past year and a half.

    • Reply
      John 2 weeks ago

      That’s the same as saying it’s going to be a busy year because money laundering.

      You can say it… But you’re speculating that it will be busy and you are speculating it is because of the dip in detached prices. And this is why your comments don’t garner respect.

      If you read the article, BD points out the increase is largely from people raising the floor, and not a declining ceiling. Further, sales are only up on a YoY basis, they are well below the long term trend.

      So no, I dont think your comment holds even an ounce of water.

  • Reply
    DB 2 weeks ago

    It looks bullish to me..and will be until its not…This is just what the market needs (sarcasm)…Get it listed while you can still make a buck..flood the market with all these prospectors looking to cash out. Then the ones who need to sell drop their prices again and again only to screw up the numbers..lets hope the realty companies are right..but to an average Joe they are way to high for me to get back in right now..

  • Reply
    Gear74 2 weeks ago

    To many Blue bears here : still waiting for Toronto crash? Specially in the core? Good luck. With 150 K migrants/immigrants coming to this city and with so much employment around the prices of houses and condos and rent for this properties in Toronto core will only go up. Agree it would be slower growth, not like last 2 years but growth.

    • Reply
      BS Check 2 weeks ago

      “Toronto is seeing its net intraprovincial migration numbers plummet, and that’s bad. From 2012 to 2017, the net intraprovincial migration was minus-142,465, a 77.53 per cent larger loss than the period before. This means over 142,000 more people left Toronto for other parts of the province than Toronto attracted. This pace is a lot higher than the pace of population growth.” – Huff. Post

    • Reply
      Gigi 2 weeks ago

      Employment around the prices of houses and condos????????

    • Reply
      John 2 weeks ago

      Durham Region: The 2016 census showed Whitby had the highest median income of $42,200 per year.

      Let’s be generous and assume that has increased to $50,000 per year in 2019.

      Can you explain how an average pre-tax family income of $100,000.00 per year can support an average home price of $500,000.00?

      Can you explain how an average pre-tax family income of $100,000.00 per year can support an average home price of $500,000.00 AND start a family? One of the key drivers to actually buying a house.

      I look forward to your mystical calculations.

    • Reply
      Joseph 2 weeks ago

      Hey man, why do you comment on this site? There might be some bears among the people here, but I’m more of a realist even though I might sound like a bear.

      To me, there’s no clear explanation of what’s going on in the real estate industry right now. Especially Toronto. I haven’t heard one good story painted that properly accounts for everything.

      On your immigrant point, even if there are immigrants coming in, how many of them have the money it takes to afford a house without a few years of saving between 2-4 members of the family (each of them earning 26k gross pay at Timmy’s per year)? Your 150k immigrants number is a bit off. Toronto’s plan in 2017 was to bring in 170k immigrants over 2018/19/20. In 2018, the plan was for 50k. I haven’t seen the actual number posted yet.

      Further, not knocking the Ford government, but cuts will have to be made. Spending was out of control under the last government. So all of a sudden, the benefits for new immigrants might not be as shiny as they were over the last 8 to 10 years.

      Throw on that the cuts and/or freezes to many other sectors and things might get slightly gloomy in Toronto (and Ontario) for a bit.

      In the end, you may be right in your assessment, but your argument of immigrants seems weak to me.

      The most concerning thing from my perspective in all this is that we should have had the interest rate hiked over the last 4-5 years. Where do we go from here if the housing market / economy demands interest rate cuts and there’s nothing left to cut? With no interest rate left to cut, what’s the move that saves us at this point?

      • Reply
        Followers 2 weeks ago

        You got to remember canada is just a vassal state to the us. BOC will only raise rates if Us does, alternative is a collapsing currency like australia who cut, “asian capital” really worked out for them lol. They have a crashing housing market and crashing currency simultaneously as as asian capital flees, more cuts will make the problem worse.

        The reason the last BOC chair whatever that idiots name was sold off canadas gold was to devalue the currency vs the usd and basically give an advantage to exporters and put the country on sale to foreigners.

        The whole “immigrant narrative” is a smokescreen as most immigrants are broke despite high credentials(ex doctors/engineers etc driving uber) and are used either for cheap labor or for their offspring.

        The chinese politiburo/oligarchs actually moving the markets dont even live here they just park cash. When the downturn happens/if the currency depreciates further vs usd they will run to the exits all at once just like vancouver due to herd mentality.

        Toronto is just a laggard and not sustainable. Sydney/NYC/London/Van all down nothing special about toronto.

    • Reply
      Bluetheimpala 2 weeks ago

      Oh gears, you’re like my little retarded side project that just keeps chugging on fumes. There is a saying in chinese that the hungry bear will always be disappointed,maybe it’s russian or maybe i made it up but does it matter? I do it for the lulz. Tock. BD4L.

  • Reply
    Rob 2 weeks ago

    Nothing to celebrate unless you’re benefiting financially. The locals will pay later for this. BC government did the right thing, lets see if Ontario government puts the future well-being of locals ahead of short term gains.
    Also seeing a lot of effective RE marketing here.

    • Reply
      MM 2 weeks ago

      There is nothing to pay for later for locals.
      The battle between Ontario and BC is a battle of free market conservatives that know how to deal with investors and between crazy socialists in BC that think that harassing rich people and owners will have no consequences.
      You think like majority of Canadians and it is exactly why we really need to complete that insane experiment in BC and see how it is turned into Venezuela. People without any idea how market works sometimes can learn only hard way. And BC will make that bitter lesson for population.

      • Reply
        BrainswashedNoob 2 weeks ago

        I am a business owner in one of the most competitive marketplaces in the world, a true free marlet (amazon).

        If you think we truly have a free market in real estate you are a brainwashed noob. The socialists in BC are a direct result of 10 years of socialism for the rich/boomers. 0% interest rates is not a free market and inflates assets bubles and only benefits asset holders and causes malinvestment.

        Foreign capital is also only speculating in real eatate bc returns are so shit in other asset classea due to 0% interest rates.

        Those who are closest to the printing press /older generations are being heavily subsidized at the expense of everyone else/future generations.

        Socialism for everyone is a direct populist reaction to socialism for the rich/boomers for the last decade.

        The real solution is to raise interest rates to 5%, stop bailing out banks and the RE industry through fed bond buying/bailouts(the real socialism) and see how fast these zombie companies/banks collapse and real estate specs get rekt.

        That is true capitalism, the market removes weak players, not subsidize them bc they blow trudeau or ford.Right now we have socialism for rich/banks/boomers.

        So dont act like this is a free market so far from it.

        • Reply
          MM 2 weeks ago

          Looking at your nickname, I have pretty good idea who is brainwashed noob among us:)))
          Interest rate 5%? Do you even have any idea what the target/goal of central banks is?
          I give you a hint, central banks DON’T WANT DEFLATION. SURPRISE, my free market guy.

      • Reply
        TrollLover99 2 weeks ago

        not sure you actually understand what the term “Socialism” means…via wikipedia Simple English: “Socialism is an economic and political system where the ways of making a living (factories, offices, etc.) are owned by the workers who run them and the people who depend on them, meaning the value made belongs to the people who make it, instead of a group of private owners. ”

        Having rules around a market doesn’t make it socialism. Good luck with your ESL classes.

        • Reply
          MM 2 weeks ago

          Yeah good luck with your socialism definition. And good luck with calling that harassment of rich people in BC – “rules”.
          Modern socialism is: If you are rich, you must pay something to make your neighbor richer.
          Canadian crazy socialism is: if you are rich and in real estate, we will harass you until you stop running all businesses.

  • Reply
    mmr 2 weeks ago

    Will these people ever give up of there wish of crash? Get it over with. World has changed money from rich people of developing world will keep pouring in. I am disappointed Ford government didn’t cancel the 15percent unjust tax yet. I think it should be withdraw ASAP. its a free market if you cant afford it move to another city.

    • Reply
      Cto 2 weeks ago

      Mmr
      I totally agree it should be a free market.
      Yep I totally agree with removing the 15% tax. And…:
      1. Normalize interest rates to 5%.
      2. Remove cmhc completely.
      3. Remove the new home buyers program.
      4. Stop subsidizing the price of electricity.
      5. Increase property taxes to level that’s sustainable.
      I think that’s it….

      • Reply
        Ian 2 weeks ago

        Almost forget the BOC needs to stop buying mortgage bonds. They’re unnecessarily expanding the monetary supply to suppress rates.

    • Reply
      I_Love_English 2 weeks ago

      Freedom to move to another city =/= Free Market…I know “Free” shows up in both, but it’s important to use language correctly pumpkin

  • Reply
    Joe 2 weeks ago

    Are you kidding? A positive head line on BD?!?

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