Does Toronto Only Have 6-Month Market Corrections?
Only with the benefit of hindsight can you truly grasp a shift or change in the real estate market. Thanks to our 20/20 hindsight, there is no doubt that the bottom of the Toronto real estate housing market was between August and February. That was 6 months. Not long. And certainly not as long as we all expected. Whether it was us real estate pundits, media, banks, etc., we all believed 2023 would be a down, maybe flat year. We were wrong. The ’08-09 Financial Crisis only caused a 6-month Toronto real estate slowdown. The start of the Covid-19 Pandemic caused another 6-month slowdown. What happened each time? The market went upwards at a good clip.
Now the question that we are asking is how long does this uptick last? There is a significant issue on the horizon with Commerical real estate (thanks to the shift in usage from the Pandemic.) We are already hearing about cracks in the San Fransico market. It’s likely going to add stress to the financial markets. But does it trickle down to residential real estate? Again, time will tell. We may need our “20/20” hindsight to answer that one.
We have recently seen an increase in sellers coming to the market who purchased in the last 2-3 years. The question is, why sell now? Our suspicions:
1) A move up in the neighbourhood.
2) (We suspect this one is more likely) Perhaps the increase in variable interest rates has been too burdensome, and the drop in values and recent recovery is a natural out for these homeowners. The possibility of getting their money out and avoiding any further volatility is attractive. This avenue allows homeowners in this situation to sell in a seller’s market versus having to sell in a depressed marketplace.
Toronto Real Estate Market Report – April 2023
April 2023 was extremely quiet in Toronto’s central areas. There were only 1285 sales. Toronto’s real estate has begun its recovery. Our overall annual markers will provide a better sense of value increase, which you can reach out to us here to discuss.
Detached Home Values
There were 268 sales in central Toronto in April 2023. The average home sold for $2,303,630, down 11% since April 2022 (we are now seeing the year over the years values come into place, there is no doubt that the correction has taken hold of our real estate market.) The average home was on the market for 15 days – below the Toronto average days on the market – this tells us that active buyers want to buy today.
Semi-Detached & Townhouse Values
There were 167 sales in central Toronto in April 2023. The average home sold for $1,543,683, down 7% since April 2022. The average home was on the market for a relatively short time compared to the TRREB days-on-market average of 11 days.
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Toronto Condo Values
There were 850 condo sales—the average central Toronto condo sold for $857,930, down 8% from April 2022. The average condo was on the market for 17 days – condos are beginning to move more quickly as buyers accept the interest rate hikes. Note that the correction has not impacted Toronto condos as much as it has affected the freehold housing market.
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