Now, what is important to point out is that the number of homes available for sale has been down substantially compared to 2010. I often get asked as to why this is the case — I wish I knew. There has been a lack of inventory for the last 2-3yrs or so and the case has many Realtor's and industry leaders completely stumped. Increased competition between buyers for (a lack of) available listings has really prompted this upward pressure on prices.

Here is a quick summary of sales in May, along-with average prices:

One request I have had from a number of buyers are listings within specific school boundaries (I am looking at you, John Fraser Secondary School). I am finding that there is a lack of inventory in many of these boundaries and there is a huge demand for them. It really doesn't surprise me one bit. Especially around the top schools.

I only deal with current situations. With the Spring market well underway, parents will be looking to purchase their home now in-order to get their kids ready for September. If you are interested in selling your home, give me a shout. Now may be the best time this year.

This represented a 20 per cent decrease compared to the 5,185 sales recorded during the same period in 2009. New listings increased by 21 per cent annually to 7,985.

“The pace of existing home sales in the GTA has slowed to more normal levels following a record-setting start to 2010,” said Toronto Real Estate Board President Tom Lebour.

“Due to higher mortgage carrying costs, sales in the second half of 2010 will not be as high as what was experienced during the last six months of 2009.”

The average price for June mid-month transactions was $437,039 – up seven per cent compared to the average of $407,716 recorded during the first 14 days of June 2009.

“The seller’s market conditions experienced during the first few months of the year have given way to more balanced conditions. Home buyers are experiencing more choice,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “With more choice in the market place, price growth is starting to slow.”

Source: The Toronto Real Estate Board

Average price has climbed a WHOPPING 19% from the previous year; from $343,632 to $409,058.

HOW DO WE COMPARE TO LAST YEAR?

If January 2010 is a strong sellers market, then 2009 was the polar opposite.  While a 19% increase in price would have any economist shaking in his boots, it is important to remember that this time last year we were in a market where the buyers were in control.  This time last year, we had a very low 13% sales-to-listings ratio.  That means we sold only 1 in every 8 homes available a year ago.  This year, the ratio is a much healthier 41% – meaning we are sold 1 in every 2.5 homes available.

WHAT KIND OF MARKET ARE WE IN?

Based on the sales-to-listing ratio, we are currently in a sellers market.  However, if we analyze the numbers it would indicate that the strength of the sellers market is starting to weaken a little.  This is based on the sales-to-listing ratio: in a balanced market, we believe 1 in every 4-to-5 homes will sell; this would be a sales-to-listing ratio of approximately 20-25% (Anything below that number indicated a buyers market: as seen in January 2009 when it was 13%; anything above that would indicate a sellers market which is where are right now).  In the last 6 months, we have seen that number reach scary heights – 58% in June, July & October, and have been over 50% since June 2009.

The image below shows the ratio since 2007 – and you can see how it shifted so dramatically from a buyer’s market to a strong (and scary) seller’s market in 2009 that resulted in big increases in average price.

HOW DOES IT LOOK LIKE IN THE REAL WORLD?

I get asked “How is the market” about 4-6 times every day.  My answer always depends on whether you are on the buying end or the selling end.  Sellers right now have the luxury of having more buyers to choose.  Last week we listed a townhouse in North East Mississauga and we had multiple offers and we managed to get significantly over asking.  On the same token, we have worked with buyers and competed with 5 or 6 other buyers on homes.  We have won some offers and lost some offers – as is the nature of the beast.

If you are thinking about selling – there is no better time that now.  We don’t know what the market will look like in a few months.  If you are buying, patience is the key in finding the home that you love and working with your agent to get it at a price that makes sense.

Until Next Month!

2009 has come and gone and will be remembered for the economic slowdown that led many to start ushering the dreaded “R” word.  The Toronto housing market gave us a rollercoaster ride, starting with a strong buyers market in the first few months of the year and ending in one of the hottest sellers market we have seen in the last twenty years.

December was no different with the Toronto Real Estate Board recording 5,541 home sales – up 115% from the previous year (2,577 sales) and was the best December ever recorded.  The previous highest December was in 2007 with 4,646 sales.  The below graph is a history of December sales, and there is a distinct upward trend with a big drop in 2008.

Perhaps one of the most requested statistic is that of average price.  The average price for December 2009 was $411,931, up from $361,415 just twelve months earlier.  That’s an increase of approximately $50,000 in one year.

Average price of homes in Toronto have seen a steady increase over the years.  The below graph shows the average price from 1995 to 2009 and any potential home buyer can see that investing in real estate is always a safe bet.  Average prices have grown year after year, and property values continue to grow.

The next graph delves even deeper, and shows the percentage change year after year (on average) on property values in the GTA.  In 2009, we saw average prices increase 4.25% from the previous year (note, this number was deflated due to the slow months at the beginning of the year), but as the graph shows, property values have consistently increased 4-6% every year.  This is a very important statistic if you are planning on purchasing a home and want to get an idea of how much your home will be worth when it comes time to sell.

One of the biggest stories of 2009 was the sudden shift from a buyers market (the first buyers market we have seen in many years) to a very strong sellers market.  The graph below illustrates this – the purple line shows the rapid change for 2009 and shows how since June we have seen a drastic change in the market place.  While the interest rates and cost of home ownerships remains low, Buyers will continue to look for homes, leaving the sellers in control.

2009 was a very interesting year in the housing market.  As other economic indicators told us we were heading for a dreaded “R”, the housing market remained one of the strongest sectors through the economic slowdown.

If forecasts are accurate, then we expect 2010 to follow on from 2009.  Interest rates will remain low for the next 6 months at least means buyers will continue to search, and leaving sellers in control.

Looking forward to a very exciting 2010!

All the best,
Roy

You may have heard people in the Real Estate world talk about a shortage of inventory, however, just to paint a picture – October 2009 had the lowest number of homes for sale since January 2003 (note, this does exclude a couple of Decembers where inventory is typically low because of the holiday season).  This time last year, people entering the market had almost DOUBLE the amount of homes to choose from.  Active listings were down to 14,771 from 27,277 last year.

Even scarier is the impact that this has had on average prices.  Average prices have increased approximately $70,000 since this time last year, a 20% increase to $423,559.  To give you an idea, stable Real Estate growth from year to year is approximately 5-7%.  20% growth is not normal, however, we do have to consider the impact of the “Stock Market Crash” that we experienced this time last year and it’s affect on prices a year ago, therefore, this 20% increase may be skewed a little because of that.

Despite the lack of listings and increasing price, sales are through the roof.  October 2009 was the BEST OCTOBER IN HISTORY in terms of sales.  The Toronto Real Estate Board reported 8,476 sales in October 2009, up from 5,155 (64% increase) last year.

So let’s break that down – 64% MORE sales, 46% LESS inventory has led to 20% increase in prices.

If you have a home to sell, taking advantage of this market situation is simple.  Price correctly, stage your home, hold off on offers for 5 days and profit.  If you are in the market to buy a home, then taking advantage of the situation is a little trickier.  Be patient and work with your agent and above all, act quickly.  Average days on the market for the entire GTA is down to 26 (from 37 last year), and there are pockets of Mississauga where the average is just 17 days.

We expect this hot market to continue in to the holiday months.  If you are interested in Real Estate around this time, make sure you have a good professional on your side!

If you wish to subscribe to our newsletter and receive monthly market updates, you can sign up at www.amitandroy.com/subscribe

Until next time!
Roy Bhandari (Sales Representative)
Signature Service/GMAC Real Estate

Archives:
60 Second Market Watch – September 2009 – GTA sales remain strong through September
60 Second Market Watch – August 2009 – Strong Seller’s Market Watch Continues Into August
60 Second Market Watch – July 2009 – Sellers Market back in full swing
60 Second Market Watch – June 2009 – TREB Reports Best June on Record

The month of September saw a HUGE decrease in the number of homes available for sale, just 15,894 active listings, down an incredible 42% from the previous year (27,373 in September 2008).  This has resulted in a 10% increase in average price, from $368,549 to $406,877.  This is the biggest jump that we have seen all year.

The graph below illustrates the average percentage price change compared to the same month between 2009 and 2008.  In January, prices had dropped 8% from the previous year, and have steadily increased to the 10% increase we have seen in September.   We have spoken to clients who purchased homes in January during the economic slow down, and they have already seen up to $70,000 increase in the value of their home in just 6 months.

Further, the average “days on market” home has fallen below 30 days for the first time since April 2008 meaning homes are selling as fast as they ever have.  Homes in the GTA sold in just 27 days on average in the month of September, and even faster in certain pockets of Mississauga – the graph below shows the average days on market since January 2008 and this graph tells the story of how our market has changed dramatically over the past 20 months or so.

Finally, the year-to-date sales currently stand at 66,437, up 4.5% from the previous year.  The board predicts that we will pass 80,000 sales by the end of the year, which will bring 2009 in line with some of the best years on record.

With home prices increasing so rapidly, now is an excellent time to get into the market.  Similarly, if selling has crossed your mind – you may not get a better time to sell than right now.

Until next month,
Roy Bhandari (B.Comm Hons)
Signature Service/GMAC Real Estate

The Graph below illustrates the shortage of inventory that we have seen in the last 8 months.  The graph shows the percentage change from the same month last year.  In January, we had almost 29% more inventory available in 2009 than we did in 2008.  This was during the brief Buyer’s Market that we entered into at the beginning of the year.  In August 2009 we had 37% less inventory than we did in 2008.

The lack of inventory is making it difficult for buyers.  We are aggressively shopping with 4 buyers, and are currently unable to find what they are looking for.  For many buyers, it is a game of patience and acting quickly when you find what you like.

Another interesting statistic has been the increase in average price from the previous year.  The graph below displays how pricing has been affected over the last 8 months, and again these numbers are comparing the numbers from 2008 to 2009.  In January, average price declined over 8%, whereas in August average price increased 6%.  We were at a client’s BBQ last week for a home that they purchased $468,000 in January of this year, and noticed a SOLD sign across the street.  The home across the street had 6 offers and sold for $573,000.  Prices are increasing fast, there is no question about it.

Finally, the below graph displays the Active Listings-to-Sales ratio since January 2006.  Again, we are seeing the very strong sellers market continue into August.

Toronto Real Estate Board is anticipating a strong fall market.  If you have thought about selling your home, there is no better time than NOW.  Homes are selling quicker, they are selling for more money and there are buyers waiting for new inventory.

Remember, the success of our business relies on your referrals.  If you have friends or family interested in buying or selling Real Estate we would love to serve their needs.

Thanks,
Roy Bhandari (Sales Representative)
Signature Service/GMAC Real Estate

Archives:
60 Second Market Watch – July 2009 – Sellers Market back in full swing
60 Second Market Watch – June 2009 – TREB Reports Best June on Record

The big news for me, is that despite the horrendous start to the year, and in fact entering into a Buyers Market for a few months for the first time in many many years – Toronto Real Estate Board year to date sales are up compared to the same time last year, for the first time in 2009.   This is definitely attributed to by the record setting sales that we saw in the months of May, June and July.

Breaking down the numbers for the first two weeks of August 2009 (when compared to the same time period last year), sales are up 27% to 3,832 (from 3,019) and average prices are up to $385,603 from $373,844, a 3% increase.  Below is a summary of the report.

Congratulations to all you home buyers and sellers during this incredible time for the Toronto Real Estate Board!

Roy Bhandari (B.Comm Hons)
Signature Service/GMAC Real Estate

Archives:
60 Second Market Watch – July 2009 – Sellers Market back in full swing
60 Second Market Watch – July 2009 – Mid-Month Report: TREB reports 27% increase in sales from previous Year
60 Second Market Watch – June 2009 – TREB Reports Best June on Record