If you list it, they will come. Such was the sentiment in 2022 before interest rates began to climb, and, in an equal and opposite reaction, the number of listings and the housing prices began their corresponding descent. However, in an equally predictable fashion, the tide appears to be turning once again – and, this time, there seems to be much smoother sailing in sight.
TRREB just released its monthly market report for April, and while the number of sales may be down from this time last year (when we were still on the heels of one of the most frenzied buyers’ markets on record), the numbers are up significantly from last month and appear poised to be a sign of things to come. In fact, a headline in the May 3rd edition of The Globe and Mail reads: “Toronto home sales jump 27% in April, home prices spike as recovery gains momentum” – a sharp contrast from the doom-and-gloom headlines of the past year.
In addition, April represents the third consecutive month where we have seen significant improvements throughout the GTA in terms of price appreciation, and the numbers have been particularly strong in the city’s central core.
Central Toronto Returns to the Market for Spring Season
Market analyses take a retrospective look at year-over-year as well as month-over-month data, and the Toronto market’s robust recovery can clearly be seen in the latter. Among the most significant changes is the increase in the number of transactions (ranging anywhere from two to 35% higher, depending on property type) between March and April. In fact, our team has witnessed this firsthand, listing 15 properties this week alone – an activity level acutely reminiscent of the pre-interest-rate-hike era.
In addition to the number of transactions, prices are also continuing to rise, with increases between two and seven per cent this month over last. “The market is getting stronger by the day,” says Heaps Estrin President and CEO Cailey Heaps. “We are seeing big gains as the market begins its recovery with pricing up more than 17% this quarter.”
First-time Buyers, Offer Nights and Multiple Bids are Back
Buyers, it seems, have grown accustomed to a higher cost of borrowing, and they are now returning to the market to take advantage of prices that, despite recent steady appreciation, are still lower than they were at this time last year. This increased confidence has also been buoyed by interest rates that have remained stable since the last Bank of Canada increase back in January of this year. Those who have been watching from the sidelines are now ready to engage, including many first-time buyers, which likely explains why semi-detached inventory is in particularly high demand.
Other signs of improving times include a return to offer dates, back-to-back showings, and multiple bids. And while TRREBs report shows Days on Market to be holding steady, our team has seen numerous properties sell within a week over the last month.
Lower Inventory Presents both Challenges and Opportunities
The challenge now is meeting increasing demand with what remains relatively low inventory. This classic conundrum of supply meeting demand, however, presents a great opportunity for sellers who may have been waiting things out up until now. “This is a great time to list as demand has soared and supply has not yet followed suit,” says Heaps Estrin Real Estate Agent Martha Grant, “though with the increasing pricing trends we are currently witnessing, that may soon change.”
As far as buyers are concerned, it can be intimidating to enter a market with limited inventory on offer. For those buyers, it is more crucial now than ever to seek the advice of an experienced agent to help navigate the constantly evolving landscape. “Whether it’s an early look at exclusive listings or leveraging our team’s expertise in negotiation, we have numerous strategies to help our clients secure the house of their dreams, regardless of market conditions, without ever settling.”