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Remax West Realty Inc,, 1678 Bloor St W., Toronto, ONM6P 1A9
Remax West Realty Inc,, 1678 Bloor St W., Toronto, ONM6P 1A9
Market Report September 2020

September was another month of growth in average prices for GTA real estate driven mainly by the low-rise segment. Both demand (sales volume) and supply (available listings) have had the same trend compared to August. Month over month figures show that available listings are up by an average of 3.3% compared to August, while sales volume has increased by 3.5%. While condos have generally cooled off in the GTA, the low-rise sector has seen strong upward pressure across the GTA, especially in Durham and Halton regions.

Exodus out of the downtown core…

A trend that’s developed since the early summer months has continued in September. Condos in the downtown core are now officially in a buyer’s market, with moderate to strong downward pressure on prices. There are currently 2995 condo listings available in downtown Toronto, only 567 have sold in the last 30 days (absorption rate of 5.3 months of inventory). There are many factors for the influx of supply in the downtown core.

  • Airbnb landlords are either putting up their units for long-term rent or for sale.
  • With downtown rental prices dropping some investors are selling their investment properties.
  • Space is scarce for the many work-at-home condo dwellers. There are many that are choosing more space in the suburbs, especially considering they don’t have to drive into work at the moment.
  • When there is a sudden increase in supply potential buyers get hesitant because they think that they’ll get a better price if they wait.

The big question is, what will happen once things return to “normal”? Will people continue working from home exclusively? Will they avoid using public transit? Will the amenities of the downtown core not be important anymore? Will students not go back to universities and colleges? I think the answer to all of those questions is a resounding NO. Once we have a viable treatment for COVID-19, life will return to normal again. And all of the things that made Toronto a world-class city will still be desirable! In real estate terms that means that demand for downtown Toronto will be high once again, it’s only a question of when that will be.


What is an absorption rate or months of inventory?

The Absorption rate or months of inventory (M.O.I. for short) is deemed as the most accurate way to pinpoint whether a market is in favour of sellers or buyers. Found by comparing home sales versus how many listings are currently on the market, M.O.I. essentially asks the question: How long would it take for every single property to sell if no new homes were put up for sale?

LOW-RISE (detached, semi, & townhomes)

As indicated by the months of inventory report or MOI, in September detached homes continued the summer trend of a very strong seller’s market. Detached homes in the GTA have had moderate to strong upward pressure on prices in September lead by Durham (0.7 M.O.I.), closely followed by Peel (1.1 M.O.I.) & Halton (1.2 M.O.I.). Toronto (1.7 M.O.I ) is in a slightly cooler seller’s market while York (2.1 M.O.I.) is heading towards a balanced market. As is usually the case when the low-rise segment starts having strong price growth, semi-detached houses and townhouses tend to be in a hotter seller’s market than detached houses. The entire GTA has an absorption rate below 1 M.O.I. for semis and townhouses. Bidding wars are the norm for this segment at the moment and every property sells for more than the last comparable.

HIGH-RISE (condo apartments)

The condo market ranged from a seller’s market to a buyer’s market depending on the area. As you can see in the M.O.I. report Durham (1.2 M.O.I.) and Halton (1.7 M.O.I.) have slight upward pressure on prices, while Peel (2.4 M.O.I.) and York (2.6 M.O.I.) are in a balanced market with little to no movement on prices. Generally Toronto (3.6 M.O.I.) is uniform across the city whether prices are trending down or up. That’s not the case in September. Downtown Toronto condos are firmly entrenched in a buyer’s market with moderate to strong downward pressure on prices. The absorption rate ranges from 5 M.O.I. to 7 M.O.I. depending on the area. Etobicoke and Scarborough are experiencing a range of slight upward pressure to no movement on prices with absorption rates hovering around 2 to 3 M.O.I.

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