At Dwelly, we understand that closely monitoring weekly changes is especially important during these times. We hope the following information can help those looking to get in or out of the real estate market make more informed decisions.
Throughout this article we focus on market activity and stats of the downtown Toronto condo market, with the downtown area being the C01 and C08 TRREB Municipalities. For additional information regarding the market amidst this pandemic, you may read our March 2020 Market Report or the COVID-19 & Toronto Real Estate Article.
Number of New & Sold listings
With the current State of Emergency in Toronto, properties are not getting the exposure or foot traffic that is typical of the spring market. Unsurprisingly, fewer listings are being released onto the market week over week, along with fewer sales.
Selling/Buying During COVID-19
Most sellers are pricing their properties at what they expect the property to sell for, and foregoing offer nights almost entirely.
Although average sale and list prices have dropped over the past four weeks this could also be related to the fact that the number of total listings has been slashed by roughly 50%. With that in mind, it can be assumed that owners of higher priced luxury properties and more disposable income are more likely to hold off on selling during these times. Meanwhile, distressed homeowners, who are living paycheque to paycheque, are more likely to sell since they might not be able to afford the risk of holding out or the carrying costs. This is especially the case if owners of a rental property are dealing with tenants who are not able to make rent payments.
When a property has an offer night, we usually see that it sells for more than the asking price due to competing offers. Most listings are now coming out without an offer night and that would help explain why the list to sale price ratio has dropped. Although this ratio has slightly decreased since mid-March, it still remains close to 100%, which means most sellers continue to get close to what they are asking for.
It might be expected that during these times the number of days a property stays on the market would increase, however, the average days on market (DOM) has been fairly volatile week-over-week and continued to stay within the range of 10 to 12 days. The lack of impact on the average DOM could be partly credited to the fact that buyers who were facing heavy competition prior to the pandemic are now able to secure homes without having to hold off until offer night. That, coupled with the employment uncertainty and constant changes to the mortgage market, urges buyers to quickly secure mortgages before any drastic changes.
- New project launches are being held off until further notice, while some existing projects that have already launched are still available for purchase.
- Construction on most buildings has taken a halt, depending on which construction phase the project is currently in. Those who have already purchased a pre-con property will likely experience respective delays in completion dates.
- From a builder's perspective, the market is in a state of uncertainty. Some major condominium development project sites have recently gone into receivership, which can happen when developers are unable to keep up with building and construction costs.
Dwelly tips and reminders
- Mortgage rates are fluctuating and qualifying applicants can be affected so we highly suggest to include a Financing condition with any offer to purchase, even if you have obtained a mortgage pre-approval. This condition protects buyers not satisfied with the mortgage rate obtained or buyers not able qualify for a mortgage at all
- Many buildings are not allowing real estate agents to show properties during these times. So if you are looking to sell or buy this can be a limiting factor.
- If you are looking to sell your home, we highly suggest you get a virtual property tour completed with your property in order to showcase it properly.
- If you are looking to purchase a home during these times, there would be no harm in negotiating the price - which was not really a possibility just a few weeks ago.
Dwelly lets you purchase a home right from the comfort of your couch - wherever you are. Request video showings, ask questions, submit and sign offers - all online. If you're interested in learning more or would like to invest in the Greater Toronto Area real estate market - message us via our online chat or email us anytime at [email protected]