December 12, 2022

In November only 4,544 residential properties were reported sold for the greater Toronto area. This is the lowest number of monthly sales recorded in 2022 and almost 50 percent fewer than the 8,979 sales reported for the same month last year. It has been almost 15 years since the market has seen numbers as low as those produced in November.

Although the average sale price has declined substantially since the spring, in fact it has declined by almost 20 percent, it appears to have stabilized. In November the average sale price for all residential properties sold in the greater Toronto area, including condominium apartments came in at $1,079,395, a 7.2 percent decline compared to last year. As the chart below indicates, there is a substantial range in average sale prices between condominium apartments and detached properties.

Average sales prices in the 905 Region have, since the pandemic market peak in February and March of this year, declined more dramatically than in the City of Toronto. The exodus from the city and its dense living conditions that drove prices up in the communities surrounding the city has greatly dissipated, and with that dissipation, average prices have declined.

One of the factors keeping average sale prices from falling below $1 million has been the lack of supply. In November only 8,880 new properties came to market compared to 10,044 last year, a decline in inventory of almost 12 percent. At this point in this evolving market, sellers are not under any pressure to get their properties on the market and sold. Most property owners in the greater Toronto area have locked into very favourable mortgage financing and it appears are prepared to wait for improved market conditions before making their properties available for sale.

Buyers are still in the market, notwithstanding the shifting market landscape. In addition to the lack of supply, they are constrained by the lack of affordability caused by rapidly rising mortgage interest rates and a wait-and-see attitude. Buyers are trying to determine if mortgage financing costs have stabilized and what their future direction might be, and if in turn home prices have reached the low point of their decline.

Unfortunately, it is too early to make this determination. As this Market Report was being prepared the Bank of Canada once again increased its benchmark rate. In February it was 0.25 percent, an unprecedented increase of 1,600 percent in only 9 months. It's not surprising that buyers are on the market sidelines, wondering where the residential real estate market is headed.

As painful as the latest increase in the Bank of Canada's benchmark rate maybe there is some positive light in the Bank's most recent announcement. In raising the rate to 4.25 percent, it indicated that further increase may be at an end. In the past, all rate hikes were accompanied by announcements stating that further increases could be expected, and they were delivered. This time the Bank indicated that it will assess the inflation landscape in January and depending on its findings, only then decide if further increases are necessary. If the Bank concludes that no further increases are necessary at its next meeting, that will be the signal that the real estate marketplace that we have been experiencing is at an end. At that time and the resale market will begin to adjust to the new normal which will result in greater buyer participation and increased sales.

As forecast in our September Market Report, sales have continued to decline on a year-over-year basis. In October 4,961 properties were reported sold in the greater Toronto area, almost 50 percent fewer than the 9,743 properties that changed hands last October. The decline in sales is a continuation of a pattern that started in March when the Bank of Canada began its fight against inflation by increasing its benchmark rate. The Bank further increased the benchmark rate by 0.5 percent in late October bringing the current rate to 3.75 percent. In early March the rate was 0.25 percent, an eyepopping increase of 1,400 percent.

For the fourth consecutive month the Toronto and area resale housing market produced declining sales and lower average sale prices. The housing market peaked in February for average sale prices, in March for monthly reported sales. In February the average sale price for the greater Toronto area came in at an incredible (and unsustainable) $1,334,000. Sales in March hit 10,881, which was not a record. The record for March sales was achieved in 2021 when an unbelievable 15,627 homes of all types were reported sold.

In July the average sale price came in at $1,074,754, a 19 percent decline compared to February’s peak. It should be noted that July’s average sale price was still 1.2 percent higher than July 2021’s average sale price of $1,061,724. Sales in July were more than 47 percent lower than a year ago. There were 4,912 properties reported sold throughout the greater Toronto region. Last year 9,339 homes were sold. Compared to the 10,881 properties reported sold in March, sales in July have declined by almost 55 percent.

There is no mystery as to why the market has changed so dramatically in such a very short time period. The housing market, not only in Toronto and surrounding areas, but universally in North America, was supercharged by pandemic forces (the need for space and safety and the ability to work remotely) and historically cheap money. Money is no longer cheap and with society returning to a form of normalcy, the housing landscape is, compared to February and March and all of 2021, unrecognizable. The Bank of Canada’s benchmark rate is currently 2.5 percent. In March it was only 0.25 percent. In only four months it has increased by 900 percent! Mortgage interest, rates have correspondingly also increased (although not as dramatically) from approximately 2 percent in March to close to 6 percent today. With the inflation rate in Canada at about 8 percent, it is anticipated that when the Bank of Canada meets in September, another rate hike is expected.

Contrary to the commonly accepted view, the declining average sale prices that the market is experiencing are not making housing in the greater Toronto area any more affordable. In fact, rising financing costs are making buying a home in Toronto less affordable. A recent Ratehub study has indicated that with the stress tests and the higher borrowing costs, a buyer in Canada needs $18,000.00 more in household income per year to buy the average priced house than they would have required in February when the average sale price was $1,334,000. That number is even higher in cities like Toronto and Vancouver.

Two market sectors in the City of Toronto are, to some degree, operating contrary to overall market conditions. Firstly, condominium apartments. Notwithstanding declining average sale prices, condominium apartments continue to sell for strong prices. Overall condominium apartment prices were 7 percent higher than last July – 12 percent higher in the 905 region and 4.3 percent in the City of Toronto. The explanation is obvious. In an increasingly unaffordable housing market, condominium apartments remain the most affordable housing type. In July the average sale price of all condominium apartments sold was $719,000, somewhat higher at $744,000 in the City of Toronto.

Secondly, the City of Toronto’s eastern districts. In July all properties in Toronto’s eastern districts sold in only 15 days and for 102 percent of their asking price. The overall market saw properties selling at 99 percent of their asking price. Also, all eastern district properties sold after only 15 days on the market. This compares very favourably with the 20 days it took properties to sell in the overall Toronto and region marketplace. The explanation for this market phenomenon is less clear. It isn’t price. The average price for all properties sold came in at $1,014,000, marginally less than the overall average sale price of $1,019,000 for all City of Toronto properties reported sold. It would appear that the eastern districts, particularly Riverdale, Leslieville, and the Beaches, are viewed as more desirable than other parts of the City by buyers.

Looking forward we should anticipate that this cycle of declines in sales and average sale prices to continue, however not as dramatically as the declines we have experienced since February and March. Until inflation stabilizes and the Bank of Canada stops increasing its benchmark rate the prevailing housing landscape will remain unchanged.

Not unexpectedly June produced a substantial negative variance when compared to the numbers that the Toronto and Region residential resale market produced in June of 2021. Rising mortgage interest rates have over the last three months caused sales to drop fairly precipitously, and although sales prices are off from their high of February of this year, they remain higher than average sale prices achieved last June. 

In June 6,474 properties were reported sold, a 41 percent decline from the 11,053 properties reported sold last June. The average sale price came in at $1,146,254, more than 5 percent higher than the average sale price of $1,088,991 achieved last June. Having said that, a review of what’s been happening since February, both as to sales and average sale price, gives a more accurate description of where the Toronto and Region residential sales market is going. 

As the above-noted chart indicates, since February the average sale price has declined by $185,000, or 14 percent, and since March, sales have declined by more than 40 percent. These declines can be charted in direct relationship to the increase in mortgage interest rates. Although declines in both sales and average sale prices will continue as the Bank of Canada raises its benchmark rate in its effort to fight inflation, those declines will be more moderate going forward, unless the Bank of Canada raises rates so high that it tips the Canadian economy into recession.

Interestingly, June’s numbers continue to demonstrate that the demand in the Toronto and Region resale market has not dissipated with rising mortgage interest rates. In June, all properties (on average) sold in just 15 days, only 2 days more than the 13 days it took last year. (This number may not be entirely accurate since it does not reflect properties that were listed and cancelled, then relisted at a lower price). Also, all properties reported across the region sold for 100 percent of their asking (also not an entirely accurate number) and in the City of Toronto at 101 percent of their asking price.

Regardless of the precise accuracy of these numbers they clearly demonstrate that there are many buyers in the marketplace searching to buy homes. As more immigrants settle in the greater Toronto area the demand will continue to grow and create the same market pressures that manifested themselves before and during the pandemic. They won’t be fully apparent until the Bank of Canada has inflation under some control and mortgage interests rates stop rising.

It should be noted that whereas during the pandemic (not that it is no longer with us) properties in Toronto’s 905 region sold faster and at higher prices than homes in the City of Toronto. That pattern has been reserved. As health and travel restrictions have eased, buyers are no longer looking for the space and safety that ground-level properties in the 905 offered. In June every housing type in the City of Toronto – detached, semi-detached, townhouse, and condominium apartments – achieved average sale prices substantially higher than corresponding counterparts in the 905 regions. Secondary markets – markets within 200 kilometers from Toronto – are similarly experiencing downturns both in average sale prices and sales.

The number of new listings coming to market will also have a substantial impact on both sales and average sale prices. In June 16,347 new listings came to market. This compares favourably with the 16,193 that came to market last year. However, due to declining sales, we enter July with 16,093 properties available to buyers, 42.5 percent more than June last year. If this continues buyers will have more choice, sale prices will be negotiated in the buyers’ favour, and more properties will languish on the market until they are sold or the listings cancelled.

Early indications in July are that the slide in sales and average sale prices will continue. Buyers are waiting to see how high the Bank of Canada will raise rates, and as a result how much lower prices will drop.

As forecast, the rising mortgage interest rates (not to mention other factors at play, like the war in the Ukraine, inflation, and ongoing supply chain problems) had a direct impact on the number of residential properties reported sold in April. At the end of April, the five-year fixed mortgage rate was 4.19 percent. In February the five-year rate was 2.79 percent, an increase of more than 50 percent in a mere two months. Coupled with the mortgage stress test that all borrowers must undergo when qualifying, it is not surprising that many buyers, particularly first-time buyers, have been forced out of the market. Those who qualify may have had to lower their price-point expectations.

In the face of daunting obstacles, the Toronto and area residential resale market produced stellar results, albeit not the stratospheric results achieved during the same period last year. In the face of rising interest rates, the war in Ukraine and its global consequences, government legislation primarily directed against foreign buyers and investors, and a desperate lack of inventory, the Toronto and area market produced the third-best March and the second-best first quarter on record.

  

Any comparison with March 2021 is almost pointless. During the first quarter of 2021, the resale market was being driven by the frenzy of the pandemic, causing indiscriminate buying, particularly in suburban and secondary markets. Even without all the obstacles, the market is currently experiencing that level of activity was unsustainable.

  

In March, 10,955 properties were reported sold, almost 30 percent fewer than March of last year, but as indicated above, still the third-best March on record. As a clear demonstration of how strong the market was in March, the average sale price came in at $1,300,000, not far from the record price of $1,334,328 achieved just last month. March’s average sale price is almost 20 percent higher than the average sale price of $1,097,351 achieved last year.

Given rising mortgage interest rates, it is not surprising that average sale prices have plateaued. The trend of constantly rising average sale prices is at an end and will stay steady until the current cycle of rising interest rates is at an end. Rising rates have the immediate effect of removing fringe buyers (often first-time buyers) from the market and lowering the price-point expectations of others.

If there was any doubt about the strength of the Toronto and area marketplace, two statistics dramatically prove the opposite. In March, all properties that hit the market (on average) sold in only 8 (unbelievable!) days. To emphasize this point, all 10,955 properties that sold in March were listed, marketed, negotiated, and sold in only 8 days. Even last year during Toronto’s strongest market in history, it took 10 days for all properties to be sold.

Not only did all properties sell in only 8 days, but they sold for an eye-popping 113 percent of their asking price, and this included 3,154 condominium apartments. In Toronto’s eastern trading districts all properties sold at 121 percent of their asking price. If a buyer were to go further east into the Durham region they would find that all properties that hit the market in March sold for 123 percent of their asking price. Semi-detached properties in Toronto’s eastern districts close to the central core continue to defy all market obstacles selling at almost 130 percent of their asking price. These statistics do not reflect a weakening market.

Despite the obstacles faced by the Toronto and area market, the growth in average sale prices was stronger in the 905 region as compared to growth in the City of Toronto. This continues the pattern that started during the pandemic, where less expensive homes offering more space were available.

Overall prices in the City of Toronto increased by 15.8 percent and by almost 27 percent in the 905 region.

High-end luxury properties continue to sell well. In March 1,165 properties having a sale price of $2 Million or more were reported sold. Year-to-date 2,841 properties in this price category have been reported sold, 93 percent of these sales being detached properties in the City of Toronto and the 905 region. Last year only 982 properties were reported sold in this price category.

  

As the market moves into April, supply shortages continue to be a problem. In March a little over 20,000 new properties came to market, almost 12 percent fewer than the 22,747 that came to market last year. As we enter April, buyers’ choice remains limited. At month end there were 10,167 available properties for sale, down over 4 percent compared to the 10,603 available last year. Based on the pace of sales, there were only 0.9 months of inventory in the entire greater Toronto area. The supply was marginally better in the City of Toronto, primarily because of the availability of condominium apartments, coming in at 1.1 months of inventory. Given the population of the greater Toronto area (approximately 6.7 million) a healthy, balanced market requires at least 20,000 properties monthly on a continuous basis available to buyers.

Inflationary pressures resulting in increasing mortgage rates and continued government intervention in the resale marketplace will mean that the months to come will be similar to what we saw in March. Average sale prices will stall, which is welcome, and sales numbers will trend downward as compared to 2021. Without a large increase in supply, which is less than likely, even under these contradictory market forces, it will remain a seller’s market, but with less demand and fewer buyers competing for the same properties.

It’s now official, the most expensive city in Canada, at least from a housing perspective, is Toronto. February’s resale market performance pushed Toronto prices to new records, breaking records achieved only last month in January.

In February the average sale price for all properties sold, including the sale of 2,772 condominium apartments, came in at an eye-popping $1,334,544, almost 28 percent higher than the $1,044,957 achieved last February, and more than 7 percent higher than the record of $1,242,760 realized in January. Toronto and area housing prices are now more than 60 percent higher than they were at the beginning of the pandemic.

The reasons for this unbelievable increase in prices have been historically low interest rates, a lack of supply, continued growth in population (in 2021 the population of the greater Toronto area is estimated to be 6.4 million, which means that more than 1 in 6 Canadians live in the region) and the fact that there is now a prevailing view that a home is not merely bricks and mortar, where families live and grow, but the most important asset in the accumulation of wealth. The asset valuation affect at play is very similar to why people invest in the equities market, particularly when interest rates are exceptionally low, as they have been.

Given that supply is low, it is not surprising that sales in February were lower than February last year. This year 9,097, a strong number by historical standards, but almost 17 percent less than the 10,929 sales recorded in 2021, all due to supply and lack of inventory.

In February 14,147 new properties came to market, a sharp improvement from the 7,979 properties that came to market in January, but almost 7 percent fewer than the 15,146 new listings that became available to buyers last year. Consequently, heading into March there were only 6,985 available properties in the entire greater Toronto area, 20 percent fewer than at the same time last year. These are critically low numbers. To put these numbers into perspective, the available inventory today is only about a third of what was available at the beginning of 1997. With 430,000 new immigrants expected in 2022, many of whom will end up in the greater Toronto area, there is no immediate relief expected.

Average sale prices continue to be higher in the city of Toronto as compared to the 905 region, but as has been the pattern since the beginning of the pandemic, the gap between the two is narrowing.

In every category records were broken. Of particular note are the prices of detached houses in the city of Toronto, which broke the $2 million barrier. As eyepopping as this number is, in Toronto’s central trading areas the average sale price for a detached properties almost hit the $3 million mark, coming in at $2,952,369. Condominium apartment sales, what used to be the city of Toronto’s least expensive housing form, also broke records with an average sale price of $863,210. Just before the pandemic, the average price for all properties sold in the greater Toronto area was a shockingly low $819,043!

In a month that was full of new records, the time that available properties spent on the market before being reported sold can only be described as startling. In February all properties (on average) that hit the market were reported sold in only 9 days. Single digit time periods on the market have been the norm in some trading areas, but never for the entire greater Toronto area. There were 2,772 condominium apartments sold in the greater Toronto area, 1,842 of them in the city of Toronto. They all sold after spending only 11 days on market. There are no longer any meaningful superlatives to describe what is happening in the greater Toronto marketplace.

As we move into the month of March, the burning question is, will rising mortgage interest rates dampen this unprecedented marketplace? The answer to this question depends on how high and how quickly the Bank of Canada raises is rates. Its initial increase on March 2nd was only 0.25 percent, bringing the Bank rate to 0.5 percent. This increase was modest. Given all the other forces that are driving the Toronto and area marketplace, the impact on the residential resale market will be negligible and in fact may have a FOMO (fear of missing out) affect, driving people to buy now before rates get higher in the future. If rates continue to rise to pre-pandemic levels, in conjunction with the record prices for housing now at play, there is little doubt that home prices will plateau. For prices to come down, the downward asset valuation effect would need to be dramatically stronger than the overwhelming upward pressure on the house prices generated by population growth and the prevailing lack of supply.

There were a few surprises and once again a number of new records established by the Toronto and area residential resale market in January.

First, and very noteworthy, was the average sale price for all properties reported sold. It came in at an eye-popping $1,242,793, surpassing the previous record of $1,163,210 achieved in November of last year. By contrast, last January the average sale price came in at only $966,068, a year-over-year increase of almost 30 percent. This is not supposed to happen in January, historically a quiet month, and it happened during a snow filled month making access to properties extremely difficult.

As has been the case throughout the pandemic, the increase in the Toronto and area average sale price was 905 driven. As the chart below indicates, year-over-year price increases in Toronto’s 905 region averaged almost 34 percent and only 24 percent in the City of Toronto.

As a result of these increases, the 905 has dramatically reduced the gap in housing prices between the City of Toronto and the 905 region. With more people working from home and needing more interior and outdoor space, this pattern will continue throughout the foreseeable future.

A trend that began in the second half of 2020 has now become common place, namely the disparity between list and sale prices. Throughout the entire Toronto and area marketplace all properties sold for 113 percent of their asking price, including 2016 condominium apartments. The most startling disparity was the reported sale of semi-detached properties in Toronto’s eastern districts. All semi-detached properties throughout the eastern districts sold for 127 percent of their asking price, and astoundingly in the neighbourhoods of Riverdale and Leslieville the sales to list ratio was 134 percent, another market record, and a buyer’s nightmare. This discrepancy will only get worse. At the beginning of February there were only 26 active semi-detached property listings for the entire eastern trading area.

The luxury market has also undergone a major transformation over the past few years. In January, 590 properties were reported sold with a sale price of $2 Million or more. This compares with only 331 in January 2021, 130 in 2020, and a mere 76 in 2019 – a 676 percent increase in three years. This is also, no doubt, a record. Clearly the definition of “luxury” will have to be redefined.

The other end of the market spectrum, condominium apartment sales, continue to increase in price. A year ago, condominium apartment sale prices in the city of Toronto resulted in a negative variance, down 8 percent compared to 2020. This January condominium apartment prices rose by almost 22 percent to $760,643. But the real story is in Toronto’s central core. In January, 966 apartments were reported sold with an average sale price of over $800,000. Considering that central core sales account for almost 70 percent of all City of Toronto apartment sales, what used to be the most affordable housing type is starting to become quite pricey. What’s worse is that in one year the available supply of condominium apartments has declined from 2,360 to 1,095, a 53 percent decrease.

Supply generally will be the driving – rather inhibiting – market force in 2022. Supply was at an all-time low at the end of 2021, with no improvement in January. January saw 7,979 properties come to market, a decrease of almost 16 percent compared to the 9,438 that came to market last year. As buyers venture into the February market only 4,140 available properties await them, a 44 percent decline compared to the 7,396 (also extremely low) available last year.

With this shocking low level of supply, it is not surprising that reported sales were down in January compared to last year. There were 5,636 sales in January, down over 18 percent compared to the 6,888 property sales last year. Notwithstanding this negative variance, it must be remembered that January’s numbers are very robust compared to what used to happen in January before the pandemic. For example, in January 2020, the month that Covid-19 became part of our vocabulary, only 4,546 sales were reported, and the year before that only 3,968.

Looking ahead all eyes are on the Bank of Canada and when it will raise interest rates. Given the level of demand and the lack of supply the impact of higher mortgage interest rates will likely be moderate. Those buyers struggling to qualify today will be forced out of the market, especially first time buyers, but for every one of them there are still many who are intent and capable (if they can find one) on acquiring a house.

In 2021 we experienced an unprecedented residential resale market. More records were shattered in 2021 than in any other year of record keeping – sales prices, properties sold, and, unfortunately, inventory levels all established new records. As we end 2021 and move into 2022, it will be inventory that will have the greatest impact on the resale market.

Let’s begin with December’s data.

Sales declined in December as compared to 2020 only because of a lack of inventory. Demand continues to be at record breaking levels, but to put it bluntly, there just weren’t enough properties on the market for buyers to purchase. That is dramatically illustrated by the fact notwithstanding declining sales, the average sale price for all properties sold, including condominium apartments, came in at $1,157,849, 24.2 percent higher than December 2020.

It should be noted that increases in average sale prices were substantially higher in the 905 region as compared to price increase in the City of Toronto, as the chart below clearly illustrates.

The increase in average sale prices in the 905 region during the pandemic has been nothing but stunning. As forecast in a monthly Market Report earlier in 2021, the difference in average sale price between properties in the City of Toronto and the 905 region has all but disappeared. The reasons for this market change are due to the pandemic driving buyers away from the denser concentration of population in the City of Toronto, the ability to work remotely, affordability, and supply. It would now appear the attraction of supply and affordability may no longer exist.

The luxury end of the resale market also broke records in 2021. In December 473 properties traded hands having a sale price of $2 Million or more. Last year only 287 properties sold in this price category. On a year-to- date comparison, 7,807 properties valued at $2 Million or more sold in 2021 compared to only 3,649 last year, an increase of 114 percent. Sales in the 905 region in this category contributed substantially to this increase in 2021. Detached property sales in Oakville, King, Richmond Hill, Whitchurch-Stouffville and Uxbridge all came in with average sale prices in excess of $2 Million, with King approaching an average sale price of $3 Million. Historically this only happened in central Toronto.

The residential resale market rebounded in September after five months of declines in sales and the lull of the summer months. There were 9,046 sales reported in September, 18 percent fewer than reported last year, but more than 5 percent higher than the 8,580 reported sales in August, the first month-over-month increase since the early spring of this year.

As indicated in our August Report, there are a number of themes that are driving the market, themes that will continue at play for the remainder of this year and into 2022.

1. AVERAGE SALE PRICES

Average Sale Prices for all properties sold have been fairly stable through 2021. The average sale price has been approximately $1,080,000 since February, fairly consistent throughout those months, including the month of March, which saw the market deliver an unbelievable 15,629 sales.

In September, however, the average sale price jumped to a record-breaking $1,136,280: eye-popping because it includes 2,664 condominium apartment sales, which represent 30 percent of the entire market with an average sale price of only $708,000. Needless to say, the average sale price of ground-level property was on fire, with the average sale price for detached and semi-detached properties in the City of Toronto coming in at $1,779,000 and $1,305,000, respectively. The average sale price for the greater Toronto area will continue to rise, primarily by what is happening in the 905 Region.

2. CITY OF TORONTO – 905 REGION DISPARITY

In September average sale prices in the 905 Region once again accelerated much faster than in the City of Toronto, as is illustrated in the chart below.

As measured against all property types, the average sale price increased by more than 25 percent in the 905 Region as compared to only 12.2 percent in the City of Toronto (416).

The reason for this disparity is obvious. House prices of all types remain substantially less expensive in the 905 Region as compared to the City of Toronto, however they are catching up.

3. DEMAND-SUPPLY TENSIONS

September has clearly illustrated that demand, throughout the greater Toronto area, is dramatically high, and unfortunately, supply is chronically and historically low. It was no surprise that affordable housing was a key campaign platform for all parties during the recent national election.

At the end of September, there were only 9,191 available properties throughout the greater Toronto area, almost 50 percent fewer than last year. It is not surprising therefore that all properties that came to market in September (on average) sold in only 14 days, and substantially less in some sub-markets; for example, semi-detached properties in the City of Toronto (only 11 days). What is especially concerning is that the available supply in the 905 Region has dwindled dramatically.

In September of the 9,191 properties available for sale, 52 percent of them (4,821) are located in the City of Toronto. Of those 4,821 available properties, 2,918 are condominium apartments. Historically only 30-35 percent of available properties were located in the City of Toronto, the balance in the 905 Region. There is no clearer evidence that the pandemic has caused buyers to look beyond the City of Toronto, where house prices were less expensive and the supply was more plentiful. Not any more.

4. LIST PRICES VS. SALE PRICES

Except for one trading area in the City of Toronto, where the average sale price was $5,625,720, the recorded sale price of all properties sold throughout the greater Toronto area exceed the asking price, on average by 106 percent. This is a first, and it proves that in this market the list price is merely a starting point. No one expects that the end sale price will be equal to or lower than the asking price. This phenomenon is a product of the demand-supply problem. In some trading areas, the end sale price exceeded the asking price by substantially more than 106 percent. For example, all semi-detached properties in Toronto’s eastern trading areas sold for a breathtaking 118 percent over the asking price.

To reiterate, the list price of properties today is only a starting point.

5. CONDOMINIUM APARTMENT SALES

Condominium apartment sales, devastated by the early effects of the pandemic, have come roaring back, and so have their sale prices. In September 2,664 condominium apartments were reported sold across the region, exceeding pre- pandemic sales numbers. Of those 2,664 condominium apartment sales, 1,792 were in the City of Toronto.

As the chart above illustrates prices are following sales. In the City of Toronto, the average sale price increased to $744,730 and to $634,111 in the 905 Region, 8.5 and 18 percent, respectively. In the central core of Toronto, where 1,176 sales were recorded (44 percent of all recorded sales) the average sale price reached $806,242, a record high and the first time the average sale price has exceeded $800,000. Even Toronto’s least expensive housing type is now becoming pricey.

Going forward the five trends that have been discussed in this Report will continue to influence the resale market. Expect sales in October to be even stronger than September, with continued pressure on sale prices due to the lack of available supply.