Toronto’s real estate market went through a churn in the wake of a health crisis conjured up by an invisible pandemic. The hottest property market in Canada hit the pause button as social distancing and quarantine measures took effect during the fag end of March.
The glowing embers of a red-hot real estate spring market got extinguished as people stopped listing their homes on the market and new home buyers, worried about what this pandemic will bring, shelved their home-buying plans. A palpable panic reigned over the real estate market.
But realtors adjusted to this new normal for conducting real estate transactions. With the government of Ontario announcing real estate transactions as essential services, real estate agents took the creative path and resorted to online selling via real estate virtual tours, live video sessions and digital transaction tools. While homebuyers also insisted on in-person tours, those were carried out under strict safety measures.
Toronto sold houses in thousands in March post lockdown
The initial days post lockdown couldn’t drown the expectations of home buyers, excited to get a good bargain from the red-hot spring season. The Greater Toronto Area clocked figures of 8,012 sales, up from 12.3% from the previous year out of which the City of Toronto registered 2,771 sales, up 8.88% from last year.
Though Toronto Regional Real Estate Board (TRREB) had decided to stop face-to-face real estate activity in the city on March 24, post lockdown, it had little effect on homebuyers as thousands of people still ventured out and bought properties.
Before March 15, a total of 4,643 sales were registered in the whole of Toronto, an increase of 49%. After March 15, home sales tanked 15% to 3,369.
Toronto Real estate sales bottom out
The real impact of coronavirus in Toronto’s real estate market was evident from the end of March when sales dropped 18% to the middle of April when real estate transactions stood at an all-time low of -73%. This happened as a result of sellers holding their property price that was pegged during February and deciding to wait out the pandemic crisis until a buoyant wave of demand returns.
Though online sales were happening, they contributed less than the expected mark of total real estate transactions in the month of April. As the lockdown measures were gradually relaxed, real estate activity picked up nearly 35% from the abyss; something that can add cheer to the real estate market.
Homebuyers and sellers haven’t lost faith in Toronto’s real estate market and are upbeat about its turnaround. New listings have witnessed a spike throughout May, indicating a heating up of the property market again.
Toronto Real Estate set to shoot up in the coming months
Toronto’s real estate market hasn’t seen a complete halt during the pandemic months. Transactional volumes indicated that the spring excitement has been subdued, but residents are still interested in buying a home.
According to a survey by TRREB, 34% of Torontonians have expressed a profound interest in buying a home within the next 12 months. Their intentions of buying were down last year during the spring season. But looking at how the initial months of Toronto’s real estate panned out, homebuyers are upbeat on getting good bargains. 45% of homebuyers in the age group of 18-34 expressed stronger intentions of buying a home while families represented 37%.
Though the pandemic has affected home sales, studies suggest that home-buying intentions remained stable. Once the lockdown gets over, people will show renewed interest in home buying and satisfy their pent-up demand.
Consumer confidence will improve as businesses open as people will make full use of lower mortgage rates to buy a home. Some may still go the online way in looking for a home as the after-effects of the pandemic can haunt home buyers.
When it comes to selling, 17% of the property buyers were sold on listing their property in the coming twelve months while most of the respondents in the survey expressed their unwillingness to register their homes for sale, due to price concerns. The supply issue may remain for some time, but once the real estate market recovers fully, the supply glut will ease out.
In the coming months, home affordability will be a glaring concern and the government has to address this after doing meticulous research on the demand and supply ratio. Until then, let’s wait and watch.