Episode 117: Real Estate Is Affordable Again! No really…it is.

Ok, hear me out.

During the big run-up of early Q1 2022, it’s no secret that new records were being set with every single sale.

Supply was meagre. Historically low.

Homes that were previously selling for $900K were suddenly trading for up to $1.2mm.

Homes that were trading for $1.2-1.4 started selling for up to $1.6-$1.8

All in a matter of weeks.

A home that sold today for $1.3 would sell for $1.4 tomorrow.

Buyers were highly frustrated; Sellers were delighted.

If you had a house or condo that wasn’t selling in early 2022, you had a significant pricing problem.

How did buyers get approved for all of these big sales? How did appraisals work out during all of that madness?

Interest rates were insanely low, boosting the buying power of every buyer—especially entry-level buyers.

Entry-level buyers were in heavy competition. They drove $400-500K condos up to $600-700K virtually overnight.

What else are you supposed to do when you’re up against 55 other legitimate offers? You need a home…you wanted to get on the property ladder, so you made it happen any way you could.

So now we are with the Shi(f)t hitting the fan, and if you bought in January or February, your property might be worth a little less today.

Does that matter? Why? Are you a day-trader? Did you sell your house or condo a couple of months after buying it to take an actual loss?

Last week I reported that over 70% of all houses and over 50% of all condos sold in multiple offers for over the asking prices.

Not all properties are worth less today than they were in early Q1.

Yours could even be worth more. It depends on what type of home it is and the location.

Communities in the West end are piling on listings while the East end remains fairly undersupplied still.

We’re bringing out two listings this week that will sell for big numbers.

So what happens when the Bank of Canada increases their rates by another 50 basis points tomorrow? Honestly, about the same that’s been happening over the past couple of months.

Buyers are sidelined right now. A LOT of buyers are sidelined, and supply is increasing.

But is supply increasing across the board?

It’s not.

How’s the market right now, and what does it all mean to you?

If you’re a buyer out there, you must work with a specialized local agent in the community you’re looking in.

Why?

Imagine you’re an out-of-area agent, and you think the market is still strong everywhere. You come in over the top and make an unnecessarily high offer. I see it happen every week and HOPE that they come across my listings. I love it when that happens for our sellers 🙂

Or you think the market is super soft and waste a ton of time and effort losing on the property after property.

Some pockets are super confusing right now—Main and Gerrard as an example. There’s a subdivision in there with similar homes.

A detached on Whistle Post sold for way over asking over $2mm. My clients picked up a similar detached a couple of weeks later for $1.6mm $100K under asking. What’s the difference? One was fully done up, staged and renovated, while ours was a little rougher around the edges.

An out-of-area agent wouldn’t have even thought to go over that home at $100K under asking when a similar option sold for over $2mm.

Specialization matters, especially in a market like this.

Sellers, you all need to calm down! First, do not sell if you don’t need to. The last thing we need are unnecessary listings with people trying to “test the market.” Now’s not the time for that!

Hold hold is the name of the game. You are the supply. You have control. You shouldn’t make short-term decisions that will affect your life.

Hold unless you need to sell.

Those that need to sell are still doing well in many cases.

And by doing well, I mean, they’re achieving prices similar to Q1 2022.

The rest are selling well still but with different strategies. Not all properties should be under-listed, and not all properties will sell for over asking.

The significant differences we’re seeing now are those entry-level houses that were all trading at over a million. Many of them are now back down to earth in the $900’s, so if you’re one of those buyers that cannot surpass the $1mm threshold, this is your time to shine.

If you’re buying a move-up-type property, the big savings you’re hoping for may not be there. Many of the fully done, new, renovated, sexy homes are still getting a ton of action and selling for huge numbers.

It’s a confusing market out there for the layperson. The spring team exists for the sole purpose of removing the confusion and the anxiety for our Buyers and Sellers. That’s how we train our agents, and that’s how Ryan and I operate.

Anyway, this type of market requires a lot more one-on-one attention, so please call/email/text, and we’ll talk through your specific situation.

That’s all I have for now. Any questions? Just reply to this email like you always do, and I’ll get right back to you!

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: $1,634,835
House Median Price: $1,528,000
608 Active Listings
53 Firm Sales This Week
Months of Inventory (MoI) ~ 1.4
Average Days on Market ~ 8.40DoM

Condo Average Price: $831,092
Condo Median Price: $735,000
1775 Active Listings
87 Firm Sales This Week
MoI ~ 1.62
Average Days on Market (DOM) ~ 12,89

Urban North: Rosedale, Deer Park, Moore Park, Forest Hill, & Lawrence Park
House Average Price: $3,718,093
House Median Price: $4,020,000
147 Active Listings
11 Firm Sales This Week
Months of Inventory (MoI) ~ 1.81
Average Days on Market ~ 20,18 DoM

Condo Average Price: $1,039,154
Condo Median Price: $890,000
213 Active Listings
13 Firm Sales This Week
MoI ~ 2.12
Average Days on Market ~ 16,23

Leaside, Davisville, Yonge & Eglinton
House Average Price: $3,111,875
House Median Price: $2,675,000
53 Active Listings
8 Firm Sales This Week
Months of Inventory (MoI) ~ 0.87
Average Days on Market ~ 7DoM

Condo Average Price: $706,750
Condo Median Price: $640,000
149 Active Listings
10 Firm Sales This Week
MoI ~ 1.75
Average Days on Market ~ 14 DoM

Birch Cliff
House Average Price: $1,154,000
House Median Price: $1,175,500
29 Active Listings
5 Firm Sales This Week
Months of Inventory (MoI) ~ 0.98
Average Days on Market ~ 17.25 DoM

Kingston Rd Corridor to Highland Creek
House Average Price: $1,339,335
House Median Price: $1,225,000
82 Active Listings
12 Firm Sales This Week
Months of Inventory (MoI) ~ 1.25
Average Days on Market ~ 11,16 DoM

Condo Average Price: $640,000
Condo Median Price: $630,000
48 Active Listings
3 Firm Sales This Week
MoI ~ 1.16
Average Days on Market ~ 9.333 DoM

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