Pent-Up Demand Due to COVID is Bolstered By Economic Recovery
Following months of uncertainty, it seems things are finally on the up for the Greater Toronto Area’s real estate market. June 2020’s momentum continued into July with the Toronto Regional Real Estate Board (TRREB) recording 11,081 sales through its MLS System for the month. This signifies a buoyant 49.5 percent, seasonally-adjusted increase compared to June 2020 and a record-breaking year-over-year increase of 29.5 percent over July 2019.
“Sales activity was extremely strong for the first full month of summer. Normally we would see sales dip in July relative to June as more households take vacation, especially with children out of school. This year, however, was different with pent-up demand from the COVID-19-related lull in April and May being satisfied in the summer, as economic recovery takes firmer hold, including the Stage 3 re-opening,” said TRREB’s president Ms. Lisa Patel.
As lockdown eased up, total new listings made a strong year-over-year resurgence of 25.7 percent, but the annual growth rate was still less than that of sales and active listings were down by 16.3 percent, which points to a tightening of market conditions compared to summer last year.
This is further reflected in the 10 percent, year-over-year rise of the MLS Home Price Index Composite Benchmark. Competition between buyers and more substantial sales growth in the expensive detached market are the contributing factors that will need to be monitored to ensure steady growth until the end of the year.
The Condo Market Shows Slow Yet Steady Growth
The Toronto Regional Real Estate Board’s (TRREB) released the latest report for July 2020 and the results are showing a boom in sales for the Greater Toronto Area real estate community. TRREB’s MLS system recorded 11,081 sales through its MLS System, a remarkable 49.5 percent increase on June 2020’s sales. Compared to July 2019, sales saw a record-breaking 29.5 percent increase.
This year-over-year sales growth was driven by a deluge of low-rise home type purchases, particularly in the regions surrounding the City of Toronto. Seeing as families seemed to move out of the heart of the city after lockdown, how did the Condo market fair?
Thankfully, condominium apartment sales were also up on an annual basis, including in Toronto. Condo sales totalled 2,423 for July, a small, but significant 6.7% year-over-year increase given June’s 22.3 percent year-over-year decrease. But the condominium continues to be the least popular choice, lagging behind the detached, semi-detached and townhouse markets.
Condos had an average price of $635,778, signifying an 8.8% year-over-year increase that falls in with the general trend of tighter market conditions. “Competition between buyers continued to increase in many segments of the GTA ownership housing market in July, which fuelled a further acceleration in year-over-year price growth in July compared to June. On top of this, we also experienced stronger sales growth in the more-expensive detached market segment,” said Jason Mercer, TRREB’s Chief Market Analyst.