City Of Toronto Real Estate Latest Market Report

On House & Condo Sales January 2018

Toronto Real Estate Market Report January 2018 Average Selling Price Victoria Boscariol Chestnut Park Real Estate

The uncertainty of current market conditions make it difficult to predict or forecast how Toronto’s residential real estate market will fare this year.

This past year has been the most unusual year in the history of the Toronto real estate market.

2017 began with a bang of a frenzied sales pace. Starting in January, and each month that followed brought higher record breaking sold prices. By March sold prices were up 29% higher than in March 2016. In April the average sold price for a City of Toronto property (including condos) was a shocking all time high of $944,000.

Then everything came to a screeching halt on April 20th when the provincial government imposed at 15% tax on foreign buyers of residential real estate in Toronto. As foreign buyers only make up 4% of the total buyers of Toronto properties, this was not anticipated to have a significant effect on the market. However, it did causing buyers to press the pause button and re-consider the high prices they were being asked to pay for properties.

While buyers waited on the sidelines by June the number of residential property sales in the City of Toronto was down 31% from the year before.

The average sold price was now on a steady decline and finally in August it bottomed out at $727,000.

During the first four months of 2017 Canadians had become the most indebted households in the World, carrying 170% debt compared to household income.

In the months that followed, and on the strength of the Canadian economy, the bank of Canada increased rates twice by a quarter point on each occasion. Suddenly buying a residential property in the City of Toronto became more expensive to service the associated debt. But government intervention was not yet at an end.

The Office of the Superintendent of Financial Institutions announced that effective January 1st, 2018 new stress tests would be applied to buyers borrowing from federally regulated lenders. These stress tests would also be applied to conventional borrowers, that is, borrowers with a down payment of 20% or more (high ratio borrowers have always been stress tested).

Effective 2018, conventional borrowers will be qualified using the Bank of Canada’s 5-year benchmark rate (which is approximately 5%) or at the current contracted rate plus 2% if that rate exceeds the benchmark rate. A buyer currently approved at 3.5% will now have to qualify at 5.5%.

Toronto Real Estate Market Report January 2018 Properties Sold Days On Market Victoria Boscariol Chestnut Park Real EstateThis brings us to December. Notwithstanding the market upheavals of 2017, December closed the year in a very positive fashion. There were a respectable 1,970 reported sales, only 6.4% less than the 2,105 sales reported in December 2016. The average sale price came in at $741,684, 4.4% higher than the average sale price during the same month last year.

The average sale price in the city of Toronto remains strong, with detached properties selling for $1,250,000, semi-detached for $903,000 and condominium apartments for $532,000.

The most dramatic change between December this year and 2016 was the increase in the number of active properties available for sale. Last year there were only 2,012 available properties. This December that number has risen to 3,736, a startling increase of 83%.

Considering everything that occurred in 2017, we should take comfort in December’s numbers. Going forward buyers will have more choice, and given the new stress tests, they will need that choice to find the property that best suits their now more restricted debt servicing budget. Sellers can take heart in that value, for sold prices have remained strong, with a healthy sustainable increase, compared to 2016.

All this points to a balanced, sustainable, yet strong residential resale market for 2018. Desirable properties in desirable neighbourhoods will continue to attract buyer attention, generating multiple offers, and over-asking sale prices.

What we don’t need is any more government intervention. The market will do nicely without it in 2018.

Toronto Real Estate Market Report January 2018 Conclusion Victoria Boscariol Chestnut Park Real Estate

Victoria Boscariol is a real estate agent in Toronto Canada with Chestnut Park Real Estate Limited Brokerage. With over 20 years experience, Victoria has been helping people successfully buy and sell condos and houses in Yorkville and downtown Toronto. As a Certified International Property Specialist (CIPS) she has worked with Buyers from around the world moving to Toronto from China, Russia, Brazil, India, South Africa, United Arab Emirates, Jordan, Cyprus, Italy, Germany, The United Kingdom, Australia and the United States.  By building an international marketing strategy for every property she puts up for sale, Victoria’s listings of Toronto homes and luxury condos get global exposure that attract qualified buyers from around the world.  

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