But the 5% sales increase in September would have been higher if there were enough houses to meet the demand
At this point, when thinking about a fresh take on the Toronto housing market, the well has run dry.
It’s like we’re hamsters on a wheel. With each passing month, the market that the pandemic abruptly seized-up only to astonish us all and light on fire has somehow settled into a ho-hum new-normal.
We’ve gotten so used to being shocked by it all that it’s like we’ve stopped registering the astonishment.
It’s almost as if we’ve entered the grim acceptance phase.
Nonetheless, now that we’re safely into October, the Toronto Regional Real Estate Board’s September market stats are in and they’re ripe for analysis.
The third strongest September on record, 9,046 homes traded in the first month of our traditional seasonal fall real estate market, up almost a full 5% from August. This is welcome news as it marks the first month since March that we have not seen a month-over-month decline in sales.
Simply put, our inventory crisis is the story. If we had enough houses to meet the demand of buyers keen to take advantage of the rock-bottom interest rates, the stats would be telling a different tale.
With fewer houses available to change hands — and September saw 34% fewer listings come to market than the same month last year — there is a built-in cap on the sales that can take place. So when looking at the number of transactions, the big tell that our numbers aren’t capturing the number of active buyers out there is the increase in average sale price.
Anecdotally, if you speak to agents, they will tell you that houses with 7, 10, 14 offers are now the norm.
TRREB President Kevin Crigger summed it up perfectly: “Demand has remained incredibly robust throughout September with many qualified buyers who would buy a home tomorrow provided they could find a suitable property. With new listings in September down by one-third compared to last year, purchasing a home for many is easier said than done. The lack of housing supply and choice has reached a critical juncture.”
In the months ahead as immigration opens back up, office towers continue to fill with people returning to work, and life starts to look like old normal once more, the structural aspects of our real estate market will only tighten. We have long been saying that this upward trajectory will slow when prices eventually hurtle out of reach, but so far the prices have continued to rise and yet the buyers remain.
As long as we have people willing to participate, these market conditions will continue to drive prices.
October will be more of the same — you can bet on that.