Home sales have continued to remain strong in the month of October. We have seen sales dip a little from September but sales continue to be very strong in comparison to 2019. We had another record month of homes sales in October.
In October 2020 there were 10,563 sales in the Greater Toronto Area compared to 8,445 in October 2019 sales were up 25.1% compared to October 2019. This is another record month but of course, we did not have a spring market this year and the sales volumes have been pushed out into the summer and now fall months.
We are however seeing that some housing segments are doing much better than others. Detached home sales by far outstripped the number of new listings coming on the market which has resulted in this housing segment seeing the greatest price increase. In October, we saw the greatest price increase with detached homes where prices increased by 14.8% in comparison to October 2019, followed by townhomes with an increase of 10.5%, semi-detached homes increased by 9.7%, and condos by 0.7%.
By contrast, we have seen the condo market slow down which has given condo buyers the benefit of having much more choice without having to get into bidding wars. This has resulted primarily in investors deciding to sell units due to the limited rental market due to COVID. The pandemic has resulted in a stall in economic growth and the halt in tourism has impact cash flows for many investors. However, given the Federal government’s recent announcement that it plans to increase immigration by 1.2M people over the next 3 years the expectation is that the condo market will quickly bounce back once we get through COVID. The sluggish current condo market is potentially creating great opportunities for investors and first-time buyers that are trying to get into real estate ownership.
Outside of the condo market, we have continued to see bidding wars for all other home segments given the short supply of new listings. We currently have just over a month and a half of inventory of properties for sale and as a result, the market continues to be a sellers’ market.
The other trend that is becoming quite evident is that the suburban and rural housing market has now attracted the interest of Toronto buyers. Smaller cities and communities such as Barrie, Guelph, and believe it or not cottage country has experienced a huge increase in demand this year for real estate and are experiencing higher price appreciation than the Greater Toronto Area.
I am a member of the Toronto Real Estate and the Lakelands Board and have personally seen the dramatic increase in demand for real estate outside the Greater Toronto Area.
At the outset of the pandemic, there were forecasts that the real estate market was going to crash. However, the economic indicators of the market performance over the last 5 months indicate that the housing market will remain strong for some time.
We have been hearing for over 15 years that the housing market was going to crash in Ontario and we have actually sensed the continued appreciation of real estate in Ontario. My opinion is that we have a solid foundation to continue to see real estate price appreciation for some time to come.
If you are thinking of buying, selling, or investing in a home or cottage it would be my pleasure to help you make your real estate dreams come true. Reach out if you have any questions.