May Stats Show Sellers in Control Once Again

2. June 2009

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The Stats are out for the month of May from TREB, and as I predicted in my last post, they show May as being the busiest month of the year so far.

Let’s break down the numbers for downtown condo sales:

In C01 (downtown west), there were 325 sales compared to 302 in May ’08 which represents an increase in sales of about 8%.

  • Average prices were down from $372K to $327K BUT the median price was only down from $320K to $304K. Clearly the high-end of the condo market has been hit hard over the past year.

In C08 (downtown east), there were 134 sales this year versus 120 last year (+12%).

  • Average prices in C08 were $298K versus $314K last year, and median price was $280K versus $293K last year. Again showing the trend that the average price has been hit harder than the median price.

Also of note, the Sales:Active Listing ratios for condos for C01 and C08 in May were 48% and 50% respectively. Clearly May was a seller’s market. This is a huge change from just a few months ago when we were seeing Sales:Active ratios in the 13-15% range.

Still that is nothing compared to the absolute frenzy that is happening in some areas of our city like East York, Riverdale, The Danforth, Leslieville, and the Beach. In these areas May had Sales:Active listing ratios in the 70-100% range.

Why the temporary insanity in the market? In my opinion it boils down to one simple reason: Supply and Demand. Supply is way down because seller’s feel a recession is no time to sell, and Demand is up because interest rates are at all-time lows.

Questions? Comments. You know what to do.

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Toronto Condos Reading List for Jan 23 2009

23. January 2009

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Looking for some good reading on Toronto Condos? Here are three very recent articles on the condo scene in the city worth a read:

The article suggests that condo prices have fallen to their lowest point, even though the confidence of buyers is still falling. If you think this idea is silly, you’re right. As readers of this blog will no doubt know, prices of downtown condos have only just begun to fall in the past 60 days or so (in the resale market). To say that prices will not get any lower is pretty optimistic. Brad Lamb is quoted as saying that days on the market (DOM) of anything less than 90 should be considered a seller’s market. Try telling someone who has had their condo on the market for the past 90 days that it is a seller’s market. Back in May 2008, Lamb was quoted as saying that 60 days should be considered a seller’s market. Now it is 90. What’s next? Time to face the facts: it is a buyer’s market.

Councillor Adam Vaughn gives a startling anecdote that speaks to the reality of the market right now: he says that he has not received an application for new development in the past 6 months, whereas for the previous 18 months before that he was receiving on average 5 per week. Wow. 

This is a commentary on the announcement that Home Depot is pulling out of their lease agreement with RioCan and Tribute Homes condo development in Queen West. The announcement invites speculation as to the real reason why Home Depot is pulling out. Is it just because of the economy? Is there something wrong with the site or the location? Is this a signal that the project will be canceled? 

What do you think about these articles? Leave a comment or contact me anytime.

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