Episode 105: Could this slowdown mean the end is near?

Yes, it is the end. The end of this cycle of gains. This is why I’m always gobsmacked when I hear agents and “analysts” talking about how this market isn’t sustainable.

Of course, it’s not. Never in the history of time have periods of significant price gains been sustained forever. Not once.

So, why the hell do people always talk about “this market not being sustainable?”

Blows my mind.

Am I the only “truth-teller” out there? No, many experienced agents who have been through a few ups and downs bring good, level-headed commentary to the mix. I love that and encourage it.

But, there are many out there pretending that they’re the only ones “telling the truth.” It uses big words that sound great and resonate with struggling people and preying on the anxiety in the marketplace. But, you got that RT, or like or share.

Do you know where most of the anxiety in the market comes from?

It comes from agents not managing their clients’ emotions and feeding into the emotional drama that naturally occurs when you’re participating in the world’s most competitive real estate market.

It’s going online and crying about “future generations” not being able to be homeowners. Remember, this is a situation (notice how I didn’t say problem?) that has no solution.

It’s blaming “foreigners,” which I’ve gone on about ad nauseam. When you hear people talking about a slowdown, please take a moment to understand the market we’re coming out of and then consider that deceleration is good and doesn’t mean prices are coming down.

Anyway, let’s talk about the market and how it all looks out there today.

Is there a slowdown? 100% there is. But, slow relative to what? Slower than 35 to 50 offers on a property. That’s what we’re talking about here.

No matter how bad, good, ugly, etc…every property was getting massive attention and offers and high prices.

Those high prices are now set, proven, and will be maintained.

Going forward, we’ll now see only the good properties get multiple offers, bully bids, 100’s of showings. At the same time, the less desirable ones get pushed to the side for a while and take a little longer to sell.

Most of this slowdown talk is about houses. Condos are on absolute fire, and buyers there need to be at the top of their game with the best possible agent they can find. However, supply is slowly adding there too.

On average, condos hit the $900K mark for the first time in Toronto’s history this past week. Let’s see if we can hold that line for a few weeks in a row for it to mean anything. But, looking at the median sale price of $821K, we’re way over pre-covid or any previous hot market numbers right now.

Record highs for condos across the board with not a single condo trading for less than $500K (studio in Liberty Village).

Supply is up for houses downtown and area, but still under one month of inventory (two to four months of inventory is considered healthy). So, we’re still in a seller’s market almost across the board.

Of the 88 house sales in our urban communities, not a single one traded for less than a million. Not one. The biggest and most surprising sale, in my opinion, was in North Riverdale on Garnock Street. A semi with no actual backyard and relatively narrow managed to get nearly a million over asking and sell for $3.1mm.

Not a single comparable to support this sale, so it’s an anomaly. Someone wanted that house and wanted it bad. An agent said it was worth less than $800K. That’s anxiety-inducing stuff. Try to block out that noise.

If you’re a buyer, you’re still most likely going to compete. The only difference is you’ll be up against fewer other offers in most cases.

You may notice agents talking about, “oh, I saw this property didn’t sell on offer night, so they pulled it and relisted it the next day,” as some sort of indicator of pending doom.

That is not the case! As we had in early Q1 this year, you don’t know how much properties will sell for in a severely undersupplied market. It’s impossible to know. So, you under list and you get what you get.

But, as supply picks up and those buyers are spread across more listings, some sellers realize they listed too low. They don’t get any action, and they relist.

Do you know what happens after they relist? They get their number. A number that was in line with the previously set high prices. In most cases.

There was only one area that did not add new listings. It is a community I’ve been talking about for months.

The Kingston Road Corridor from Main Street all the way up to Pickering. The only community in the 416 to not add supply over the past few weeks. Guess I was on to something, eh?

Have a question about something you’ve seen another realtor post? Ask! I guarantee you there will be more to the story.

Have a wonderful day, and don’t forget to share this. We have over 42,000 subscribers, and the list keeps growing. Thank you for that!

Don’t forget to follow us on Instagram and Facebook. We post some real-time stats on our channels you don’t want to miss. You can also catch up on my 2022 real estate forecast post here.

And, please find me on Twitter as I’ve been more active there these days.

That’s all for today; thanks so much for your energy and attention. If you want some clarity on the market and your specific situation, please DM, comment below or email Ara@thespringteam.ca.

Urban Markets: Downtown & Surrounding Areas
House Average Price: $1,801,047
House Median Price: $1,600,000
361 Active Listings
88 Firm Sales This Week
Months of Inventory (MoI) ~ 0.94
Average Days on Market ~ 5.9 DoM

Condo Average Price: $906,078
Condo Median Price: $823,500
800 Active Listings
203 Firm Sales This Week
MoI ~ 0.91
Average Days on Market (DOM) ~ 8.73

Urban North: Rosedale, Deer Park, Moore Park, Forest Hill, & Lawrence Park
House Average Price: $3,366,716
House Median Price: $3,190,000
80 Active Listings
21 Firm Sales This Week
Months of Inventory (MoI) ~ 1.05
Average Days on Market ~ 15 DoM

Condo Average Price: $1,208,962
Condo Median Price: $900,000
154 Active Listings
21 Firm Sales This Week
MoI ~ 1.67
Average Days on Market ~ 6.4

Leaside, Davisville, Yonge & Eglinton
House Average Price: $2,153,583
House Median Price: $1,925,000
39 Active Listings (nearly doubled week/week)
12 Firm Sales This Week
Months of Inventory (MoI) ~ 0.95
Average Days on Market ~ 7.4 DoM

Condo Average Price: $908,139
Condo Median Price: $869,500
66 Active Listings
18 Firm Sales This Week
MoI ~ 0.85
Average Days on Market ~ 7.53 DoM

Birch Cliff
House Average Price: $1,723,017
House Median Price: $1,629,050
17 Active Listings
6 Firm Sales This Week
Months of Inventory (MoI) ~ 0.72
Average Days on Market ~ 13.33 DoM

Kingston Rd Corridor to Highland Creek
House Average Price: $1,432,357
House Median Price: $1,375,000
47 Active Listings
14 Firm Sales This Week
Months of Inventory (MoI) ~ 0.822
Average Days on Market ~ 6 DoM

Condo Average Price: $712,253
Condo Median Price: $710,000
29 Active Listings
11 Firm Sales This Week
MoI ~ 0.88
Average Days on Market ~ 8 DoM

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