Toronto Market Continues To Heat Up
In the past, the typical pattern was for the real estate market to slow down as the July 1 holiday approached, with both buyers and sellers making plans to enjoy our relatively short summer season. Not this year — COVID-19 has thrown a large monkey wrench into the normal seasonal pattern.
After the sharp lockdown-induced slowdown in April, the market bounced back strongly in May, and that rebound continued apace in June. For example prices for detached homes increased by 9% versus last month and 11% versus last June. Detached price are now higher than they were at the beginning of the year, pre-COVID.
Condo prices also increased, though not as dramatically as houses, up 1% versus May and up 7% versus last June. Clearly the momentum has shifted away from condos and toward houses, although the condo market remains very strong.
The strength in the market traces mainly to the declining inventory of homes for sale. After increasing rapidly in April due to the COVID-19 lockdowns, inventory has fallen equally rapidly over the past two months, and is now back in deep sellers’ market territory, similar to early this year, pre-COVID. The reason for the quick drop in inventory is that buyers are returning to the market in force (mainly due to astonishingly low interest rates), while sellers have been more reluctant, perhaps wary of having strangers viewing their homes. Homes are therefore selling faster than new listings are coming on the market… and so inventory is falling.
Will the market continue to be hot throughout the summer? Certainly there are no signs yet of any slowdown.
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