TREB’s October GTA Data.

Each month TREB (the Toronto Real Estate Board) publishes comprehensive pricing and sales data from the previous month.

We try to interpret for our clients trends that seem to be developing and what it might mean to them if they are buying or selling. We zero in particularly on TREB areas C08 and E01 – Toronto’s Lower East Side – the neighbourhoods of St. Lawrence Market, The Distillery, Corktown, Regent Park, Cabbagetown, Riverside and Riverdale.

This month showed 8,491 residential sales – roughly equal to the 2018 high in May of last year. So while not 2015/2016 crazy, things are heating up for sure, as this represents a 14% increase over October 2018. We are continuing to see new listings down – a worrying 9.4% YoY. As we’ve predicted, this decreasing supply continues to put upwards price pressure as prices were up 5.8% over last year – the strongest growth since the end of 2017.

The trend of sales from pent up demand for move-up singles and towns that we noted over the last couple of months continues, with sales volume up 18.3% for singles and 25.5% for towns in the 416 versus last year and both up 20% in the 905.

TREB Areas C08/E01 – Toronto’s ‘Lower East Side’

E01 is still hot. So far this year, on average, selling prices are still 11% over asking and Days on Market is only 11. For semis in October, it was even hotter at 118% SP/LP and only 7 days on market on average. Buyers need to have a plan, be quick and be decisive.

In C08, condos are averaging $747K, and selling at about list price, so there are no great deals to be had. It’s a mature, well understood market. It’s possible that this will change given the platform the new government ran on with respect to easing stress test rules, but we’ll have to see whether those actually come to fruition. I mean, when has a government not done what it promised to do, right? 

We see this data supporting our opinion of E01 continuing to be in demand as a great neighbourhood, given its proximity and quick commute to the CBD and its relative affordability (in 416 terms). If prices continue to rise, we may see a lot of interest in profit-taking in the spring market and a glut of listings, so timing this sector will be critical for maximizing sales price. A year-end quick listing/sale may be a good idea.

So what are the takeaways? I’d say:

1. I think the supply squeeze is going to continue to push prices up at least until the spring market in March/April, and at some point there will be a flood of new listings trying to take advantage of that. Not getting caught in that flood as a lister is key.
2. The pent-up demand out there for detached homes especially in the 905 is staying strong as sellers have accepted the reality that we aren’t in 2017 prices any more. The demand is back.
3. TREB says new condominium apartment listings in Q3 2019 were down by 1.1% compared to Q3 2018, with 9,538 listings added this year compared to 9,636 listings added in 2018. GTA new condos are expensive at >$1100/sq ft, but not in global terms. As long as Canada/GTA continues to be the draw that it is for a global, young, talented workforce, we don’t see that changing. But right now prices don’t provide positive or even neutral cash-flows from investment properties, so until that market settles down, investing in pre-owned condos may be a better bet.
4. Money is still cheap, with no upward pressures being signalled from Bank of Canada. That will keep the price pressures up. And will likely also make people wait a bit to list, keeping inventory low.

Come and have a coffee with me if you want to talk more about what this means for you as a buyer or seller. I always love talking real estate. 

Ivan Kalinin is a sales agent at Key Toronto Real Estate Group. Zoocasa Realty Inc., Brokerage.
He can be reached at 416 858 8085. Not intended to solicit clients already under contract.