In December, the number of condos available for sale in the C01 district was down to 761 from 864 in November. The number of condos sold was down from the previous month to 259 from 355 for a ratio of 0.34. These numbers push us down slightly bordering between a Seller’s and balanced Market.

Another solid year for appreciation of condos in the GTA. Year over year we saw an increase of about 8.2% from December to December. If you had your condo 100% paid off, no mortgage… your investment would have grown by 8.2%. If it was 50% paid off, you would have seen a 16.4% return, 20% paid off would have seen a 41.1% return and 5% paid off would have seen a 164.5% return. The effect of leveraging your investment is pretty incredible. It also has the reverse impact as well though as someone that had 5% down would have lost 100% of their capital if the market had dropped by only 5%.

The median price for August was slightly down to $367,700 from the previous month’s $371,000. The average number of days on market for the month was up to 33 days from 29.

I get a lot of questions about wether we’re going to see lower prices this year. Seems like there are many news reports indicating we will. I don’t think we will. As long as you can get a mortgage for less than 3.5% or 4% and our employment rate stays healthy… I can’t imagine a significant or prolonged drop in prices. Looking at the last 7 years of growth in the chart below, we can see sharp increases in prices testing the limits at times but soon continuing upwards.



I don’t like predicting the market, but I realize our clients want our opinion and we try to base our opinions on statistics. So I think the above graph says a lot about our point of view on the current market and what we should expect this year.

In September, the number of condos available for sale in the C01 district was up to 1004 from 987 in August. The number of condos sold was down from the previous month to 356 from 371 for a ratio of 0.35. More available, fewer sold… market pushed down into balance market.

The only month where we saw lower prices in 2011 was in January, it’s the best time to buy in the last 10 months. The level of supply is quite close to typical but it seems the buyers are slowing down a bit. Since there have been no changes in lending practices, it’s very likely that buyer’s are being affected by the economic concerns of a second recession. Although buyers may be a little less confident, employment rates and interest rates all indicate a sustainable market.

The median price for August was slightly down to $361,900 from the previous month’s $365,000. The average number of days on market for the month was the same at 30 days.

The median price has come down about $13,000 from it’s peak this past June. It’s rare to see the average days on market push past 30 and that’s exactly where it’s been hovering for the past 3 months. Usually prices are very flat for the last 3 months of the year but the number of transactions in December is half of what it usually is.


*Graphs apply to most recent C01 district data.

Condo Market Report #8

In August, the number of condos available for sale in the C01 district was down to 987 from 1085 in July. The number of condos sold was slightly up from the previous month to 387 from 365 for a ratio of 0.36.

We’re just on the edge between a balanced and seller’s market. Currently we’re not seeing too many bidding wars taking place and it seems like it’s a good time for those on the sidelines to resume their search. Usually the Fall brings us more inventory and there’s a last push before the snow falls. Once December comes, there are very few transactions taking place.

The median price for August was slightly down to $365,000 from the previous month’s $369,900. The average number of days on market for the month was the same at 30 days.

The students returning have absorbed all the rentals anywhere close to their campus’s and trying to buy a 1 bdrm or 1 bdrm plus den in those same areas at that time of year is frustrating at best. Many families do the math and discover that 4 years of rent at $1600 per month equals $76,800. That’s an incredible amount of money to spend when you could choose to have an appreciating asset instead of an expense.

Many people believe the spring is the best time of year to sell but if you own an entry level condo on Bay St, or nearby, I would advise listing in late July or early August. We’ve helped many families find condos for their children going to school.

Condo Market Report #7

In July, the number of condos available for sale in the C01 district was down to 1085 from 1205 in June. The number of condos sold was also down from the previous month to 365 from 542 for a ratio of 0.34. Fewer condos available for sale and fewer condos sold with the ratio resulting in a healthy balanced market.

We need to see more of this if we want to see long term sustainability of prices. The median prices of condos have increased dramatically over the last 5 years and we need things to calm down for a while if we don’t want to any significant price corrections. I remember in the year 2002 when a university graduate with a starting salary could comfortably afford a 1 bdrm entry level condo which cost around $230k with parking. Today, that same condo is selling for $350k. Interest rates were just as low back then so the affordability has drastically reduced.

The median price for July was slightly down to $369,900 from the previous month’s $375,000. The average number of days on market for the month was up at 30 days.

Anybody who has owned real estate in Toronto over the last 5 years has done very well. Looking at the Dow Jones performance over the last 5 years from today (Aug 4th) we see a total increase of 2.74 percent. This is frustrating for many investors who have been diligently investing their RRSP’s and TFSA’s. Although I do believe in diversifying your investments between real estate and the stock market, I can’t imagine the debt crisis being solved anytime soon which has been taking a heavy toll.

Healthy employment rates in Canada along with low interest rates have been pushing real estate prices higher and higher. Unless we see 1 year mortgages over 5 or 6 percent, it’s hard to imagine real estate appreciation stopping. Combine this with the tax free growth of your primary residence, it’s easy to justify investing in a valuable home or condo for yourself.

Condo Market Report #6

In June, the number of condos available for sale in the C01 district was slightly down to 1205 from 1230 in May. The number of condos sold was up from the previous month to 542 from 471 for a ratio of 0.45. We’ve been pushed back into the Seller’s market again despite abnormally high inventory… more on that below.

The median price for June was up to $375,000 from the previous month’s $370,000. This ties the record April prices, highest ever seen in downtown Toronto. The average number of days on market was slightly up at 25 days.

I don’t usually add this inventory graph unless it’s significant. I think it’s important to show how much larger the condo market is today, even from three years ago. Typically we’d see around 800 suites available in the average month but currently we’re at around 1200 suites available. This is a reflection on the growing number of condos in the city which have registered and are adding suites to the resale market. It’s also important to understand that the demand has been growing even faster than the supply which is reflected in the rising prices.

I love making graphs.

A very common question is “What time of the year is best to buy a condo?”. We have to interpret this question as really asking “Will I pay less money for the same product if I wait?”.

I graphed the last 6 years of condo prices for the downtown condo market. This first graph simply shows the median price each month throughout each year.

If we choose January as our starting point, let’s see the percent change going forward for each year:

The result shows that 3 of the 6 years had higher prices in December than if you bought at the start of the year, 1 year was the same and 2 years… prices were lower. The punishment for waiting in 2009 was escpecially harsh. Combining these past 6 years to get some kind of an average change in prices over the year results in this:

I believe this is actually very accurate as to how it feels helping Buyers. The Spring market brings a lot of buyers to the market and we see upwards pressure on prices, the summer months are quite calm and then another push in the Fall all the way to November. My advice is always that waiting usually means having to pay more and I think the statistics support this. There have been years when waiting did bring lower prices but having that strategy is really betting against the casino… and you know who always wins in the long run.

Condo Market Report #5

In May, the number of condos available for sale in the C01 district was up to 1122 from 974 in April. The number of condos sold was up from the previous month to 393 from 347 for a ratio of 0.35.

More condos available and more condos selling. Although we’re bordering on a balanced market… it sure doesn’t feel like it. My experience is that Seller’s are negotiating very aggressively and the nicer suites available are selling very quickly. These inventory levels are quite high but the demand is keeping up. Since Jan 2005, only one other month (May 2010) had more than 1100 condos available for sale in the C01 district.

It’s important to recognize that a large proportion of these suites, especially in the lower price range are ‘assignments’. An assignment is when a Seller who has a contract with a developer to buy a suite sells his contract. That Buyer then completes the purchase with the developer. These Buyers usually do need a large downpayment to able to refund the original purchaser’s deposits and pay his profit, typically around 35% or so. Currently, there are several buildings with a high level of assignments available for sale at Cityplace Parade (183 suites) and Neptune (83 suites). These two new buildings account for 266 suites available for sale. If you have a large downpayment, there are some diamonds mixed among this group.

The median price for May was down to $358,200 from the previous month’s $375,000. The average number of days on market was slightly up at 24 days.

Condo Market Report #4

In April, the number of condos available for sale in the C01 district was up to 974 from 924 in March. The number of condos sold was down from the previous month to 347 from 448 for a ratio of 0.36.

The median price for April was up to $375,000 from the previous month’s $362,800. The average number of days on market was constant at 23 days.

Once again, prices are the headline with a new record for the median price of a condo in the downtown C01 district. This is more reflective of what we’ve seen as Realtors working in the area… it’s a very competitive time to buy with many suites selling over asking price. New listings hitting the market are priced higher than previous comparable sales but they’re still selling. I often review my client’s transactions years after the fact to monitor their investments. In June 2009, I was helping a very nice family from Alberta find a Bay St 1 bdrm plus den with parking. Our search concluded that College Park, 761 & 763 Bay St, was their first choice. The market was just as competitive at that time although prices were significantly lower. The median price in June 09 was $307k vs today $375k, a 22% increase. They bought their suite at College Park for $379k. The exact same floorplan 14 floors higher just sold for $495k. Conservatively adjusting $20k for floor height, that comparable indicates a market value for their suite closer to $475k for an increase of 25%. Although their purchase was difficult due to the market conditions at that time, they’ve done better than the average since they chose such a desirable building in a strong location.