June 3, 2022
After I shared with you my analysis based on the last Sales Report by Toronto Regional Real Estate Board (TRREB), I know you were anxiously waiting to know what is happening now in the market, especially after the effects of the BOC Rate increase by fifty base points. So let’s see the latest numbers released by TRREB for the last month, May 2022.
The market continued its downward trend from the last month as the residential transactions saw a similar negative trend of 39%, close to 41% seen when compared to the same months last year. The total transactions were recorded to be 7.3K compared to last month’s 11.9K.
The seasonably adjusted transactions also saw a 9.3% dip and recorded 6.2K in May 2022 compared to 6.8K in the same month last year.
As I have been mentioning all along, the unrealistic price has adjusted itself but the realistic price has been stable or continued to rise, it is evidenced by a positive increase of 9.4% in May this year compared to May 2021. The Average Selling Price in may rose to $1.213M last month from $1.108M recorded in May 2021.
The seasonally adjusted Average Selling Price saw a dip of 3.1% from $1.214M in April 2022 to $1.176M in May 2022.
There was a very slight jump in the total new listings in the market of a .50% increase, totalling 18,679 listings.
Even though there was a slight increase in the new listings there were fewer new listings sold recording a decline of 25% overall, bringing the Sales-to-New Listings Ratio to 39% in May 2022 from 64% in the same month last year.
Properties remained in the market much longer than last year in the same month that is 18 days in May 2022 compared with 15 days in May 2021, taking 20% more days to sell a property.
The Home Price Index (HPI) continued its upward trend and crossed the 1,250K mark. For your information, as per the TRREB definition, HPI provides a price growth measure for a benchmark home with the same characteristics over time, allowing for an apples-to-apples comparison from one year to the next.
Residential condominium sales also got a negative hit on their sales and recorded a 15.6% decline from 9,399 to 7,932 comparing the Q1 results with the same period of last year.
To the surprise of many, the Average Selling Price of Condos, compared with Q1 2022 to Q1 2021, saw a jump of 22.4%.
Total new listings saw a very slight jump, 3%, in Q1 of 2022.
Sales-to-new-listings Ration took a dip of 14% comparing the same quarter last year with 69% of new listings sold in the current quarter while 83% in the same quarter last year.
The number of days for a listing to remain in the market, recorded as 12 days, was significantly reduced, by 48%, in this quarter compared with 23 days last year in the same period.
There were 23% fewer Condos rented and the new rental condos in the market were reduced by 43% which created the supply and demand scenario and gave a jump of 18% more rent for a 1-Bed Room Apartment to $2,145 in Q1 2022 from $1,820 in Q1 2021.
The Commercial Leasing and Sales activities declined by 25.4% and 22% respectively in Q1 2022 compared to Q1 2021.
The average Industrial Lease Rate increased by 29% to $13.17/SF.
The Average Commercial/Retail Lease Rate increased by 14.4% to $22.74/SF from $19.88/SF.
The Average Office Lease Rate saw a decline of 2% to $17.73/SF from $18.1/SF.
With the Bank of Canada (BOC) rate hike of fifty base points just a day before, we will have to see the market reaction for some time to come. On one side, the change would impact negatively on the affordability of the potential buyers on the other hand one may see, hopefully, some settlement in the home prices, but only the time will tell. I will keep you posted, as always, with the latest market trends so you can make an informed decision for your, generally, the largest investment in your life.
There is always a better solution a professional can provide, sometimes beyond one’s thoughts. I will be glad to receive your call at your earliest convenience at 416-908-5600 to discuss your individual needs and goals and objectives.
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A. Q. Mufti