Toronto’s Real Estate Market Goes From Seller To Buyer In 90 Days

The final Toronto sales stats for the month of October are in and… I underestimated! We actually did slightly better than I predicted we would.

Turns out that the Toronto Real Estate Board’s final sales number was 5,155 putting our ratio of sales-to-listings at a buyer’s market level of 18.9%. This is solidly in ‘buyer market’ territory for the first time since January 2001. Wasn’t that a recession time?

As recently as July we were in a seller’s market and August and September ended up being in ‘neutral’ territory.

Sales were down almost 35% year-over-year, a dramatic number, but remember… 2007 fall sales were driven artificially higher by Toronto home buyers trying to escape paying the City of Toronto land transfer tax that took effect February 1st of this year. Compared to 2006 we were down 25% – still a large number of homes.

But let’s be frank… did YOU want to buy ANYTHING last month when the financial and stock markets were in meltdown, let alone make the largest purchase of most people’s lives?

So does that make it a ‘bad’ time? Only if you’re just selling. For buyers, it makes it a great time to buy – you can negotiate offers for the first time in many years and underpricing by listing agents to elicit multiple offers has been all but eliminated.

If you look back, most fortunes in history were made in ‘bust’ cycles, NOT when things were booming.

People moving from one home to another in this market can also take advantage. If you’re selling and buying in the same market, any lowering of value on your existing condo or house is more than made up when buying your next, usually higher priced home.

So let’s talk about that ‘average sale price’ statistic that TREB issues monthly. As you can see in the chart to the right, the average sale price YTD is still higher than for the year 2007.

Unfortunately the media typically tries to emphasize the negative and really doesn’t tell the whole, balanced story!

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