The Toronto Real Estate Board has just released the numbers for March 2018, and the sky continues to fall … or does it?
At first glance, sales COMPARED TO MARCH 2017, are down 39.5%. Average selling price for that same period is down 14.3%. What does this mean to you the homeowner? Absolutely nothing. As stated multiple times, the first third of 2017 was an anomaly. Historically low supply along with high demand resulted in multiple offers on pretty much everything, thereby driving sales and average price up. Comparing apples to oranges makes for great headlines, however it does not provide an accurate representation of current market activity. We won’t be able to compare apples to apples until the May 2018 numbers come out.
How can we get a true representation of the current market? Let’s take a look at what is happening right now:
At the end of February, we had sold 5,175 homes. At the end of March, this number was 7,228. This means that sales increased by 39.6% during March.
The average price for a home in the Greater Toronto Area on March 1, 2018 was $767,818. On March 31st the average price increased to $784,558, an increase of 2.1% during the month.
Despite the increase in inventory (41% increase in new listings, and 19.52% increase in active listings), homes were staying on the market for a shorter period of time than in February of this year. The Average DOM is now 20 days, as opposed to 25 Days in February, which represents a 20% drop.
Looking at Year To Date Pricing, on January 1, 2018 the average price for a home on the Toronto Real Estate Board was $822,434. On March 31, 2018, the average price for a home YTD is $784,558. This represents a small decrease in average price of 4.6%. Considering that homes were selling for approximately 104% of list price at this time last year, the 4.6% decrease is actually a sign of a very strong market. Moving into the second quarter, the average price YTD will continue to climb.
What does all this mean for you? If you’re a seller, buyers have returned. A 39.6% increase in sales from last month shows that consumer confidence is returning and buyers are getting off the fence. As a buyer, you see average price increase from March 1st to March 31st by 2.1%. The increased inventory has kept the average price appreciation to a minimum and buyers need to capitalize on this before inventory level start to come down and price appreciates at a more ‘Normal” 4-6% per annum. Either way, if you’re buying or selling, the time is now.