Week 173: New Mayor, New Market: Olivia Chow’s Potential Impact on Toronto’s Real Estate Amid Surging Condo Supply and Summer Slowdown

We are waking up to a new mayor, Olivia Chow.

Honestly, I still think Chloe Brown is the best candidate, and I know she has a huge future in municipal politics or beyond if she chooses to go there. Still, I also think it’s hilarious how people are regurgitating the same soundbite they hear about Olivia Chow.

All these people that don’t have two nickels to rub together, complaining about how their taxes are going to go up and deciding to go and vote for interest in candidates like Chris Sky, Giorgio Mammoliti and the other 101 or two candidates.

Many people who love to hear the sound of their own voice have not even bothered to dig into it and take 30 minutes to read through the platforms of each candidate.

Suppose you really look at Olivia Childs’s platform. In that case, it’s ridiculous to hear people like Doug Ford say, “Oh, it’s going to be a disaster if a left, leaning politician like Olivia Chow is elected mayor.

It will only be a disaster for people like him who are trying to bulldoze everything in his way in our fantastic city.

I think it’s nice to have a fresh new face at City Hall who is actually interested in helping people who really need the help, As I talked about last week.

So although I’m not a huge fan of Olivia Chow, as I don’t think she’s going to be able to do all of the things that she says she is, which politician ever has?

Again if we’re focused on the people that actually need to help and not selfishly focused on most of ourselves, who do not need any more help than we already have, I don’t know how you can argue against a new mayor who will advocate for Building new affordable rentals and using existing city, owned land and developing that land as the city of Toronto to be able to have complete control start to finish and deliver truly subsidized affordable housing.

An interesting idea that she has is to have a first right of refusal, so the City Of Toronto can have first crack at any property that’s for sale, and remember, we’re not talking about expropriating here. We’re talking about paying market value just having the first right of refusal to do so; how is that a bad thing? Again I’m not talking about developers who might be missing out on projects they can profit on, but how is that a bad thing for people who need help?

And then not as aggressive as Chloe Brown’s plan to triple the rent bank, but at least Olivia Chow will double it to $10 million to help keep people in their homes, providing more support for renters.

So all this talk about increasing taxes again I find hilarious as if people live in their day-to-day lives are going to pay more for things.

We’re talking about increasing the taxes, specifically the land transfer taxes on homes worth 3,000,000+ using a graduated program which phase is in the increase starting at 3 million than 5 million and 20,000,000+; again, it’s pretty funny hearing people complaining about this; as if it affects them where in reality it affects less than 2% of the people in the city.

The only unknown in this scenario is what will happen with property taxes. The only thing that Olivia Chow has been quoted as saying is, “It will not be as aggressive as the 25% increase of some other candidates are talking about“So again, our property taxes are meagre when compared to other municipalities throughout the country even the world so I feel like most homeowners. In fact, all homeowners can absorb the marginal increase there as well to make sure that the people that need the most help or actually helped.

And finally, increasing the vacant home tax from 1 to 3% should be a non-issue for most people, so again, I still don’t see anything that the average person needs to complain about increasing taxes.

So again, I think the city is going to be just fine, and I believe that keeping things like Ontario Place where it is, keeping Ontario science centre where it is and making sure that the residents of Scarborough are taken care of in terms of transit, once the RT shuts down or all good things.

I do, however, feel as though the Doug Ford lead provincial government will be flexing their municipal zoning order powers quite more often, so let’s see if Olivia Chow can stand up to the provincial bullies that like to push through their agendas under the guise of benefitting the average Torontonian when in reality, it only benefits a small group of people who really do not need any more help.

So let’s talk about inflation numbers came out today at 3.4%, which on the surface looks like a major improvement from the slight uptick of April at 4.4% but remember, a lot of the number is coming out now are going to be experiencing what you call the base year affect.

In simple terms, if you remember this time last year, there was a lot of uncertainty around energy prices as the war in Ukraine, so there was a massive spike in energy prices.

So energy prices today, when compared to last May or a lot lower, so when we’re comparing an unnaturally high month to a more normal stable month, we will get big swings like this. Still, at the end of the day, it is good news and a step in the right direction to bring inflation back to the target closer to 2% as we head into 2024; at that time will start seeing some downward pressure on rates.

So I think many people are confusing the lack of activity in some segments of the market as another slowdown in the market, which might be partially true, but also, let’s not forget that this kind of slowdown happens every single summer.

What’s really important is to keep an eye on his supply. Unfortunately, condo supply in the urban communities is reaching that buyer market territory at nearly 2000 units for sale, up from just over 1500 a month and a half ago. That’s a pretty big jump, And I’ve only seen that once before, and that was the beginning of Covid.

Toronto houses are still slowly adding supply, but less aggressively than they were for the past month. The good news is that sales are surprisingly up week over week to nearly 80 units sold versus the 70 last week. I honestly didn’t expect to see that considering how slow some parts of the freehold market are, but it’s good to see a lot of good quality and user product moving.

Properties that need a lot of work and ones that are targeted to developers are showing signs of serious slowing right now as money is drying up, or I should say affordable money is drying up for a lot of builders at the moment, so they’re focussed on finishing the projects they and getting out of them bring some cash on the side and waiting for opportunities.

This is generally good news for buyers as things should become more predictable if you remain active throughout the summer months.

So what’s going to happen to interest rates at the July announcement? Honestly, your guess is as good as mine at this point. Still, there seems to be a consensus out there that regardless of these positive inflation numbers That there will be another increase in July, but if history has taught us anything, the Bank of Canada loves to surprise us, so hopefully, they decide to give us an early summer gift here and keep rates where they are.

Anyway, properties are still selling, and they always will. Let’s make sure to cut out that day-trader mentality and focus on what you’re trying to do for yourself and your family. There’s a very different conversation for people looking for a home or investing, so make sure you’re talking to a real estate professional who understands the difference and doesn’t just say it’s always a good time to buy or sell.

Happy Tuesday!

And if you’d like to book a call to discuss your specific real estate needs, you can do that here, and I really look forward to helping you.

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: $1,641,243
House Median Price: $1,508,500
559 Active Listings
80 Firm Sales This Week
Months of Inventory (MoI) ~ 2.37 (up from 2.04 last month)
Average Days on Market ~7.84

Condo Average Price: $828,422
Condo Median Price: $724,000
1918 Active Listings
136 Firm Sales This Week
MoI ~3.16  (up from  2.81 last month)
Average Days on Market (DOM) ~17.80

Urban North: Rosedale, Deer Park, Moore Park, Forest Hill, & Lawrence Park
House Average Price: $3,449,402
House Median Price: $3,059,000
151 Active Listings
10 Firm Sales This Week
MoI ~ 3.47(up from 3.11 last month)
Average Days on Market ~ 15

Condo Average Price: $1,139,615
Condo Median Price: $915,000
221 Active Listings
13 Firm Sales This Week
MoI ~ 3.99 (down from 4.05 last month)
Average Days on Market ~ 15

Leaside, Davisville, Yonge & Eglinton
House Average Price: $1,663,114
House Median Price: $1,680,000
45 Active Listings
4 Firm Sales This Week
MoI ~ 1.57  (up from 1.43)
Average Days on Market  19

Condo Average Price: $822,013
Condo Median Price: $670,000
151 Active Listings
15 Firm Sales This Week
MoI ~ 2.32 (down from 2.75 last mth)
Average Days on Market ~ 25

Birch Cliff
House Average Price: $1,383,636
House Median Price: $1,200,000
31 Active Listings
3 Firm Sales This Week
Months of Inventory (MoI) ~ 1.63 (down from 1.76)
Average Days on Market ~ 6.55

Kingston Rd Corridor to Highland Creek
House Average Price: $1,627,363
House Median Price: $1,328,444
91 Active Listings
8 Firm Sales This Week
Months of Inventory (MoI) ~ 2.14 (up from 1.71)
Average Days on Market ~ 8

Condo Average Price: $675,667
Condo Median Price: $705,000
48 Active Listings
6 Firm Sales This Week
MoI ~ 2.46 (down from 3.30)
Average Days on Market ~ 14

Share: