Sales & prices shoot-up in January

Last month I had posted about what to expect sale price wise in 2020, which was that prices were expected to rise between 6%-10% throughout Toronto.

Well, January seems to have gobbled up that and more, as sale prices are up 12.3% mostly driven be the detached and condo market. Semi-detached homes and townhouse were pretty much flat.

And even though sales activity also rose in January, up about 15% over January 2019 numbers, when you seasonally adjust, activity was up almost 5% over December.

So what’s going on? Low inventory continues to contribute along with many buyers who were sent to the sidelines in 2018 and parts of 2019 when OSFI brought in mortgage qualifying changes that made it more difficult to qualify for a mortgage. As of the past few days, these stringent requirements were slightly adjusted and it will be interesting to see how they affect the already hot spring real estate market.

I suspect much of the same (low supply, higher demand) for the time being but an interesting side note is in the condo rental market, where supply is starting to add up and a slight slowing down in the market is happening. It’s not a free fall over the massive increases we’ve seen in the rental rates the past two years, but certainly any immediate future gains will be limited in the short term.

I think we are heading for a “heavy foot on, heavy foot off” on the sale side over the next few months, as both buyers and sellers adjust to the current market.

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