Toronto Condo Market Report July-August 2020

13 July 2020
Remax-Condos-Plus

Market Report July-August 2020

SALES COMMENTARY

Year Over Year Summary

The real estate market returned to some normalcy in June and hence our Report is returning to its familiar format. June sales on TRREB (that’s Toronto Regional Real Estate Board to reflect the fact that our members are doing sales over a large part of Southern Ontario) were down only 1.4% from June of 2019. Sales were also 89% higher than in May. While ‘new’ listings for the month were 2% higher than June of last year, ‘active’ listings were down by 29% (See Table 1 below). Rising prices in June are expected to continue over the summer with this current imbalance of listing product. This is especially true in the detached house market.

The condo market is a different story. Here, sales in June were down by 17% from June a year ago. At the same time, ‘new’ listings were up by 36% and ‘active’ listings were up by 17% from June a year ago. The signs are clear that prices for condos are moving in the opposite direction from houses. Sale-to-list prices are at the bottom end of the ‘balanced’ market and could be pushed into a buyer’s market by Fall.

While there is currently a rush to move to the far reaches of the 905 market, lifestyle preferences do not change over night. The appeal of condos for younger and older demographics is still there. Already the appeal to ‘work from home’ is waning for many and they want the office experience. Sports returning to Toronto will also help to return vibrancy to living downtown. Everyone is waiting for a vaccine so that they can be fully engaged. We are probably a year away, and when that happens, we predict condos will come back in vogue. For buyers and sellers, the choice is act now or wait for a year. From experience, we can say that the best time to upgrade your condo is when prices are falling, not when they are rising. That is because the price gap between 500 sf and 1,000 sf becomes the smallest.

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TRREB: JUNE 2020 VS JUNE 2019

TRREB: June 2020 vs June 2019

Table 1: This chart compares June 2020 and June 2019 in regards to TRREB sales, new listings and active listings. We can see that both sales and active listings are lower than last year but new listings is up!
source: Toronto Real Estate Board

ICE CONDOS: 12 YORK ST

Ice Condos

This month we looked at sales in Ice Condos, more specifically the South Tower of the two-tower complex. It has a great location across the street from the Scotiabank Centre and is joined to the PATH. But its biggest claim to fame is that it has been the centre of the Airbnb market in downtown Toronto. With Covid-19 and with new City by-laws, the Airbnb business has essentially ended. So what has been the impact? We have tracked all sales in this building for 2020 beginning in January. Prior to the Covid-19 shut down, there were 6 sales. Since March 17 there have been 8 sales. See Table 2 below for the impact to date.

Image source: urbantoronto.ca


MARKET FACTOR

Market Factor

Table 2: Currently there are 21 units for sale including 3 price changes. The price drop has been 9% so far.
source: Toronto Real Estate Board

TRREB CONDO MARKET SALES: JUNE 2020 VS JUNE 2019

June 2020 vs June 2019 - TRREB Sales

Table 3: The market is easing it’s way back to  normal as new and active listings have gone up!
source: Toronto Real Estate Board

RENTAL COMMENTARY

As we mentioned last month, the Rental Market is the weakest segment on TRREB. Looking at the Downtown and Harbour Bay markets, 2,000 condos were leased in June. That is 47% higher than in May. One-bedroom units made up 61% of the leases. Currently there are over 6,000 units for lease. In May there were 4600 units available. But when we looked at ‘active’ listings, 26% of these listings had at least one price change downwards. That does not take into account listings that were cancelled and brought out at a lower price. Last month we reported that rents were $100 to $250 lower than before the Covid-19 outbreak. Looking forward, the build up of units for lease suggests that rents are not about to level off until September at the earliest.

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DOWNTOWN + HUMBER BAY CONDO MARKET SALES: JUNE 2020 VS JUNE 2019

June 2020 vs June 2019 - Downtown Sales

Table 4:   *Downtown is the TRREB areas C01+C08 (south of Bloor, & DVP to Dufferin) Humber Bay is the TRREB areas W01 + W06 (south of QEW, & Humber River to Browns Line). Again, a similar pattern with condo sales, new and active listings are increasing positively.
source: Toronto Real Estate Board


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