Week 163: Why is the Toronto Real Estate Market Rallying?

The Toronto real estate market has been on a serious upswing since the beginning of February, improving weekly without a single pullback.

How long will this swing last, and why is it happening?

First, let me say that anyone who bets against the Toronto Real Estate market will lose. And we’re not talking about short-term dips in activity and price.

You’d have to be a serious fool to think that Toronto Real Estate will somehow become undesirable to the world long term.

There have been Foreign Buyer taxes, bans, and restrictions.

You know, because people love to blame foreigners for their problems often.

That didn’t solve anything, although it did take the heat out of the market in 2017; a new stress test was introduced, and many borderline buyers were kicked out of the market. So the suburbs got slammed when that happened.

Interest rates shot up from practically zero percent to 4.5% today. All in one year. From March 2022 to January 2023. Buyers jumped out of the market for a few months while they searched for more certainty.

But certainty was hard to come by from last July to December 2022. So many doomsday articles and extreme messages were being put out there by every real estate bear that could get their hands on a smartphone, and a TikTok account was spewing nonsense. Comparing today to the ’80s, the 2000’s and so on.

All while missing the context of today.

So inevitably, there was uncertainty in the air. The crash many were looking for was staring them in the face but nobody bit.

Why? Because there was no certainty that this was the bottom.

This blog and a few other brave agents, in the face of being called opportunistic sleazy salespeople, were screaming from the rooftops, this is the bottom; get buying now!

But it took a lot of work to get that message across because every dinner table, barber chair, and social gathering had nonsense being repeated and doubt being created.

Being created by people that had no idea what was happening in the market. So evne if you wanted to buy, your inner sphere, the people you see every day, were calling you crazy!

That’s why making buying decisions during down markets is so hard. Of course, there should be some concern about whether or not the market will continue to tank, but it’s mostly so you don’t eat shit from everyone you see every day you find out you’re buying when no one else is.

So I get it.

But if you’re anything like me, you like to dig deeper when things are tough. To understand why things are happening the way they are.

Once I discovered that listing supply wasn’t piling on, I knew we would be ok.

Once I realized that sellers weren’t panicking. I knew we were going to be ok.

Once I realized the events that influence interest rates and inflation, I knew when what was going to happen before it happened. Like, were rates going to go up, down or stay flat. I started to see patterns in all of that.

To get back to the question: Why is Toront’s market rallying so hard right now?

Because there’s certainty in the air. Especially since inflation numbers are down and some food costs are starting to ease according to today’s newly released inflation numbers. I’m super skeptical that we’ll hit 3% inflation by mid-year, but considering the drop to 4.3 today, it may be possible. Let’s see how increasing oil prices after May affect things.

New cycles aren’t talking about the next massive hike.

There’s no negative news about buyers losing their shirts.

There have been two rate announcements in a row with no rate movement.

Employment is substantial despite big companies laying off thousands.

People feel safe and certain, so they’re buying.

And they’re seeing what’s happening to less-than-desirable communities that only boomed because they were cheaper and nothing else.

People thought they would never come back to the office, so they moved miles. Away.

They’re all moving back to the city they love.

Toronto.

So that’s why we’re booming now and will continue to do so (despite some darker moments definitely ahead of us), but again, the bottom is behind us here in Toronto.

What do you think?

Have a wonderful day, and I’ll see you next week. Don’t forget to subscribe to the blog so you get this in your inbox asap, and we’ll see you on Youtube!

(please subscribe to the YouTube Channel here, where I go over all of these reports in more detail)

Urban Markets: Downtown & Surrounding Areas
House Average Price: $1,664,591
House Median Price: $1,450,000
410 Active Listings
54 Firm Sales This Week
Months of Inventory (MoI) ~ 1.69 (up from 1.38 last month)
Average Days on Market ~ 18.74

Condo Average Price: $886,220
Condo Median Price: $747,500
1387 Active Listings
125 Firm Sales This Week
MoI ~ 2.67 (up from 2.41 last month)
Average Days on Market (DOM) ~ 26.17

Urban North: Rosedale, Deer Park, Moore Park, Forest Hill, & Lawrence Park
House Average Price: $2,386,360
House Median Price: $2,156,000
128 Active Listings
14 Firm Sales This Week
MoI ~ 2.40 (up from 2.20 last month)
Average Days on Market ~ 14

Condo Average Price: $1,502,538
Condo Median Price: $845,000
201 Active Listings
13 Firm Sales This Week
MoI ~ 3.76 (up from 3.17 last month)
Average Days on Market ~ 28

Leaside, Davisville, Yonge & Eglinton
House Average Price: $3,187,333
House Median Price: $3,307,000
36 Active Listings
6 Firm Sales This Week
MoI ~ 1.14 (up from 1.05)
Average Days on Market  20.83

Condo Average Price: $797,002
Condo Median Price: $687,627
122 Active Listings
13 Firm Sales This Week
MoI ~ 2.56 (up from 2.43 last mth)
Average Days on Market ~ 17

Birch Cliff
House Average Price: $1,460,000
House Median Price: $1,300,000
15 Active Listings
4 Firm Sales This Week
Months of Inventory (MoI) ~ 1.05 (up from 1.02)
Average Days on Market ~ 12

Kingston Rd Corridor to Highland Creek
House Average Price: $1,437,055
House Median Price: $1,349,999
58 Active Listings
9 Firm Sales This Week
Months of Inventory (MoI) ~ 1.66 (up from 1.16)
Average Days on Market ~ 11

Condo Average Price: $609,000
Condo Median Price: $535,000
50 Active Listings
3 Firm Sales This Week
MoI ~ 2.76 (up from 2.29)
Average Days on Market ~ 26.67

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