Toronto Real Estate Market Following A Smooth Trend

After the tumultuous up-and-down price action that we saw in 2017, the return to a normal seasonal pattern in 2018 has been very welcome.

Prices and sales spiked upward in extreme fashion in early 2017 and then, after the Ontario government issued its 16-point ‘Fair Housing Plan’ in April, the bubble deflated rapidly through the rest of 2017, finally reaching bottom in January of this year. Since then, the Toronto market has returned to the orderly and predictable seasonal pattern that we saw year after year during the past 20 years or so. Prices and sales are both down significantly from last year’s grotesque extremes, but are in line with the trend prior to 2017 — in fact, prices are somewhat higher now than they would have been if last year’s bubble had never happened.

Prices and sales for all property types were down in August from July, as is typical for the summer months, and were higher than last August. The inventory of homes for sale remained steady at just under 3 months’ supply, indicating a balanced market still slightly favouring sellers over buyers.

The divergence between lower priced condo apartments and higher priced freehold properties continues to grow as prices and interest rates are both increasing. Average condo apartment prices dipped in August but still remained near the ‘bubble peak’ last spring, while freehold prices have sagged to roughly the same levels as in 2016 and 2017.

Barring any unforseen developments (and who can say in the Age of Trump!), we should see a strong market for all property types over the next 2-3 months.