Toronto Market Bounces Back in May

After being so rudely interrupted by the COVID-19 lockdown in late March, and suffering through a dismal April, the Toronto area real estate market has come roaring back May. Prices increased dramatically across all property types, the first time since 2016 (and briefly early this year) that freehold and condo properties have increased in lock-step.

Prices for detached homes, for example, increased by 5% as compared with last month, after falling by 11% in April, and are now almost exactly the same as they were last April (and, coincidentally, in April of 2018). The lockdowns quickly deflated this year’s nascent price bubble, but we are now back on solid ground with some upward momentum.

Prices for condominium apartments are following a similar trend. After falling 12% in April, condo prices increased by 8% in May, and are now higher than at any point last year.

Sales also rebounded sharply in May, up more than 50% as compared with last month, but still only about 50% of last April, reminding us of just how steep the drop in market activity was in April. Active listings also increased in April, but only by about 8%, and so the inventory of homes for sale (active listing/sales) declined from 3.5 months to 2.5 months, putting us back into a moderate sellers’ market similar to this time last year. Clearly buyers are returning to the market more quickly than sellers, and we are seeing this in the re-emergence of bidding wars in certain areas.

The Toronto real estate market has shown amazing resilience in the face of the COVID-19 lockdowns, and we can look forward to continued improvement in the market over the next few months as the economy re-opens.