The September Toronto Real Estate Market Takes A Breather

All the negative publicity coming from the US has been repeated by our Canadian media and sometimes preception does become reality.  Each week we’re hearing about Wall Street decades and century’s old companies being taken over by the Federal Reserve or by other companies.  One of the largest US lenders, Washington Mutual, was taken over in September by JP Morgan Chase and, earlier this year, Countrywide Financial was taken over by the Bank Of America. 

First commodities are the darling of stock investors and then, just as suddenly, they’re not.  Oil has dropped from its July high of $147 per barrel to under $90 today.  To me it just a whole lot of ‘gambling’ on the part of institutional investors – frankly at the expense of the normal, everyday citizen.

It’s no wonder that Toronto home buyers are taking a breather to see how everything shakes out economically in the next few weeks or months!  Here are September’s Toronto Real Estate Board statistics.  Total sales in the month were 6,424 with listing inventory at 27,373 houses and condominiums.  The statistic the papers DIDN’T tell you was that this volume of sales was only down 6.4% from September 2007 (August suffered a 22% decline) and was only down slightly from September 2006.

What the news media also didn’t tell you was that the average sale price YTD across the board for TREB was $382,930 compared to $376,236 for the year 2007.  I’ve noticed for years however that the ‘average sale price’ statistic doesn’t necessarily correlate to what’s happening in the real market to home prices.  The average can actually come down while volume of sales are up and the average can go up while some neighbourhoods have declining prices.

Now, here’s the good news if you’re presently in the market to buy a home.  The ratio of sales-to-listings edged into ‘buyer market’ territory at 23.5% for the first time in years (24-28% is considered a neutral market).  As buyer agents, we’re getting more and more opportunities to negotiate on behalf of our Toronto house and condo purchasers!  There are fewer multiple offers occuring and we’re finally getting to ‘talk terms’ when presenting our buyer’s offer!

Sellers however now have to be very realistic with their pricing.  Real life home prices are definitely lower in many neighbourhoods across the GTA and this needs to be addressed when you’re deciding to sell your home.  When the listing inventory is as high as it is, there’s more choice for a house or condo purchaser and the seller’s pricing needs to recognize that fact.

To read the entire Toronto Real Estate Board MarketWatch report, CLICK HERE.

CIBC has written a terrific summary entitled "Where’s The Trigger For A Canadian House Price Crash?".  There are some major differences between our economic situation in Canada and in the GTA vs what’s happening south of the border.  Go ahead and CLICK HERE to read this informative 2-page summary.

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