Week 189: This Week, I’m Ditching the AI and Just Rage Typing My Market Feelings

“Interest rates to drive real estate prices going forward” – like this is an official headline from a major publication. Duh…really? Thanks for this epic advice!

Like, come on – I think this week, I won’t use any AI for my reports and just rage-type all my feelings after spending the entire morning reading a billion real estate articles.

All articles contradict each other. Some agents like me say one thing, then another. Hell, I even confuse myself sometimes.

Imagine how some clients feel.

So, my mission for the past few weeks was to be in the consumer’s shoes consistently. Whenever I was about to say something to a client or a lead, I asked myself, how would someone with zero experience in the Toronto real estate market perceive what I was about to say?

I think that type of self-reflection is essential for a seasoned professional.

I then reflected on the past 188 weeks. Wow, that is all I have to say. Wow, in that, I got a lot of things right. And the exact opposite of “Wow” in that I got a lot of things wrong. Lol.

What did I get right? Looking back, I was able to spot a lot of slowing trends before they hit the mainstream consciousness. However, I have realized that one guy saying something about the market on a YouTube channel that barely has 600 subs and a blog that barely gets 10K hits a month isn’t enough to convince consumers of what’s happening.

What did I get wrong? Where do I start. When rates started to climb, I don’t think I fully understood how long it would take for the effects of the hikes to manifest. We’re just at the tip of the iceberg here with the pain some owners are feeling or are about to feel.

Do I still believe that the bottom of the market is behind us? Sort of. Is that a good enough answer?

Q4 of 2022 was extremely slow. It was slower than I’ve ever seen it. Slower than today, and prices were lower than today. So, the bottom is still behind us.

However, the next two Quarters will be critical.

Why?

I’m unsure if you’ve read the Months of Inventory numbers below, but we’ve gone from 0.5 MoI to over 3 MoI in our Urban communities in less than a year. At the same time, sales are down over 60% in those same areas.

Here’s a screenshot of Q4 2022, and here’s a link to the article from then. Sales numbers are the same, but prices are way lower. People were scared of what was to come then, and they’re still scared today. Not all people, but a lot of people.

 

 

 

 

 

 

 

 

 

 

 

 

 

If we continue down this path, we could meet our previous bottom and dip below it. But only IF the pain of the hikes continues to hit hard, resulting in must-sell situations for owners.

What if people manage to weather the storm? What if people figure out a way to hang on to their properties?

I don’t think that’s a far-fetched “what if.” I think Torontonians have proven to be quite resilient.

Despite the low sales volume, there were massive $17mm sales and a ton of entry-level sales, so money flows at all levels, just not as freely as last year or previous years.

But like I said in last week’s report, we need to stop comparing what’s happening now to the peak of the frenzy. That’s not a helpful discussion.

This is where we were at last year. What stands out to you in the screenshot below? View last year’s article here.

 

 

 

 

 

 

 

 

 

 

 

 

So what’s to come? Honestly, your guess is as good as mine (well, maybe not). There is still competition on some properties, and others have zero activity.

Properties are selling for hundreds of thousands under the asking price, and others selling for hundreds of thousands over the asking price.

Which property will perform best in this market? Select streets in our urban communities are flying. Just a few streets over, there are crickets.

I know many generalists say that the internet has levelled the playing field in quickly becoming a community expert, but sometimes, what makes a street, community, or neighbourhood perform very well in the market can’t be googled.

Meaning if you’re a buyer, you’d better make sure your agent understands the community you’re buying so you can be successful in your search.

For example, I have this listing on Brooklyn Ave in Leslieville. You can’t google the essence of that street. There’s no mention of the tight-knit community. The epic street parties. The bottom half of the street is in a different school zone than the top.

So, an agent calls me to “grind” me on the price. Little does he know that we’ve had 40 showings since Thursday and will likely get 4-6 offers tomorrow.

Who loses in that situation? Their underrepresented client. Who’ll be confused and shell-shocked at the result? All because their agent tried to be everything to everyone everywhere.

Don’t be that guy. Say thanks but no thanks to Uncle Sal or Aunt Sally, and hire the local pro you’ve been seeing on your social feeds.

Book a strategy call to discuss your situation: Book a call directly with me for personalized advice.

Stay Updated: Don’t forget to subscribe for weekly insights.

 

Urban Markets: Downtown & Surrounding Areas

House Average Price: $1,564,317
House Median Price: $1,419,000
758 Active Listings
43 Firm Sales This Week
Months of Inventory (MoI) 2.99 – UP from 1.82
Average Days on Market (DOM) 12.42

Condo Average Price: $771,203
Condo Median Price: $655,000
2690 Active Listings
54 Firm Sales This Week
MoI 4.82 – UP  from  3.87
DoM  22.72

Rosedale, Deer Park, Moore Park, Forest Hill, & Lawrence Park

House Average Price: $3,532,348
House Median Price: $2,487,500
209 Active Listings
13 Firm Sales This Week
MoI 4.71 – UP from 2.78
DoM ~ 19.15

Condo Average Price: $901,000
Condo Median Price: $718,500
303 Active Listings
10 Firm Sales This Week
MoI 4.94 – UP from 3.48
DoM  19.33

Leaside, Davisville, Yonge & Eglinton

House Average Price: $1,685,000
House Median Price: $1,780,000
78 Active Listings
3 Firm Sales This Week
MoI:  2.75 – UP from 1.45
DoM  23

Condo Average Price: $865,683
Condo Media Price: $820,000
205 Active Listings
9 Firm Sales This Week
MoI 3.64 – UP  from 2.82
DoM ~ 20.33

Birch Cliff

House Average Price: $1,367,633
House Median Price: $1,450,000
38 Active Listings
3 Firm Sales This Week
MoI 2.38 – UP from 2.03
DoM 11

Kingston Rd Corridor to Highland Creek

House Average Price: $1,423,333
House Median Price: $1,100,000
126 Active Listings
3 Firm Sales This Week
MoI 3.30 – UP from 2.53
DoM 18

Condo Average Price: $799,000
Condo Median Price: $799,000
61 Active Listings
1 Firm Sales This Week
MoI 2.72 – UP from 2.58
DoM 21

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