We expected the month of October to begin to show some signs of market growth. Instead, the GTA real estate market is largely stable.
Why?
The sellers that we expected to put their properties on the market haven’t materialized yet. As a result, the buyers looking to take advantage of prices under-asking haven’t either.
October sales were down significantly and not surprisingly, so were new listings. Many other agents have also commented on the lack of quality inventory. In fact, October felt a lot like September to me.
And while sometimes it’s good to have consistency in the market, steady, stagnant sales are not the type of steadiness that we want. While I’m hopeful that the fall market will pick up as we move into the winter season, there aren’t many indicators that it will.
GTA
The average price grew by a meek 0.2% in October, to $1,089,428 from $1,086,762. Looking back at the last four months, fluctuation in pricing has been minimal. Because if you want to talk about steady prices, the average home price since July fell between $1,074,754 and $1,089,428. That’s only a 1.37% variance. That average is also down 5.7% from this time last year, when $1,115,624 was the going price.
While we expected similar total sales results in October, we weren’t far off as they fell to 4,961 from the 5,038 in September. What is stark is the comparison to last October, when 9,743 properties were sold. That’s a 49.1% drop year-over year, which is a bigger fall than the 44.1% drop when comparing September 2022 to September 2021.
A number that also fell abruptly was new listings; 11,237 in September to 10,390 in October (7.5%). While that may still seem like a lot of listings, for agents, this doesn’t feel like enough. Plus, the listings out there don’t seem to be the right property. To illustrate what I mean, the 10,390 new listings were the lowest since October of 2002 (there were also 11,749 last October).
Keep in mind that with many of the months of inventory since the dip started in March, many of these “new listings” are properties that haven’t sold and are being listed again (not for the first time). Furthermore, what’s telling is the 68.1% increase in active listings from last October (7,748 vs 13,023 this year). As sales decline considerably and new listings fall moderately, active listings grow.
Toronto
Last month there were almost 5,000 homes sold in Toronto. That may seem like a lot, but that’s approximately 50% fewer than in October of 2021. It’s also the eighth consecutive month where sales volume experienced a significant drop from the previous year.
So, who’s buying these homes? From what I can tell, buyers are either first-time home buyers taking advantage of lower prices and fewer competitive bidders; people forced to move because of lifestyle changes (regular movement – job changes; new parents, divorcees, etc.); and those who are selling their condos because they can now upgrade to a detached home at a better price than earlier this year.
One more key stat from Toronto’s market in October: on average, homes sold for about $20K below asking price. If you have listed your home and are not getting showings, you’re likely overpriced. Remember that the market has changed, and getting that February 2022 price just won’t happen right now.
November
What does November look like? It’s probably going to be another slow month as it usually is, and December will likely follow similar trends of being fairly quiet. But it’s hard not to expect that once people start thinking about the spring and the warmer weather, the market will pick right back up and sellers will be in control again in February and March.
What to do
Sometimes no matter the circumstances of the current real estate market, you need to buy and/or sell your home. If you’re selling, read this blog to make sure you maximize your curb appeal. I would also be happy to help you navigate the current market conditions to get the best results for you. Let’s chat 🙂
Photo by Andréas BRUN on Unsplash
