There has been a lot of conversation recently about the health of the Toronto real estate market. Unfortunately, it is nearly impossible to give a a quick overall synopsis. The market is so eclectic and has so many variables that almost every micro-market in the city has been operating in its own way.
May 2022 saw a significant decline in the number of properties sold throughout the City of Toronto, but pricing increased by over 9% from May 2021.
Focusing on the luxury condo market*, it was a very similar trend; the number of sales was down by over 50%, but the average pricing on a $/ft basis was up by nearly 9%. Luxury condo buyers are still very active however are more focused on finding the perfect property without the pressure to make a quick decision.
There were 47 new listings in the luxury condo market* throughout the past month, which is still less than we would expect to see in a balanced market. What has changed is how quickly these properties are selling. Of the luxury condos sold in May, they sold in an average of 32 days which was nearly 70% longer than last year at the same time.
Another big discussion has been the continuing interest rate increases. There is expected to be at least one more increase from the Bank Of Canada over the coming month. While the increases in interest rates do play a large part in real estate affordability, the rates we are seeing today are more in line with pre-pandemic levels and essential to create a balanced market. The value of excellent properties in prime locations are less impacted by changes to interest rates and more impacted by the levels of supply available for buyers.
Takeaway: Ultimately the luxury condo market continues to stay strong. Properties well positioned in the market are seeing a fair amount of interest and the sale prices are staying very high. Buyers active in the market right now have more patience and the availability to take their time to find the perfect property. With the summer months usually a slower part of the year I anticipate that come fall the lack of good quality supply will start to see more competition from buyers on prime property and the market.
For more information on the market or any questions you may have on what to expect over the next few months, please feel free to give me a call or send an email.