Not even Toronto’s red-hot real estate market could maintain its pace in the time of COVID-19.
After monthly data in both January and February suggested a strong sales outlook in 2020 for Canada’s largest market, the onslaught of coronavirus and the subsequent shutting down of the province, has led to the last stretch of March showing a sharp decline for real estate in the city.
According to data analyzed and presented by John Pasalis, president of Realosophy Realty, Toronto’s real estate market spent the last half of March falling off a cliff. While sales had been up throughout 2020, so far, by about March 14 they started to decline from somewhere around +50-60% year-over-year to tumble all the way down to -37% year-over-year.
Pasalis stresses the importance of looking at the market week to week during such a volatile time. An example of the importance of added scrutiny during COVID-19 is seen in his summation of the arrival of March’s sales reports: “The monthly data for March which should be released later this week will show that sales are up by roughly 15% suggesting the market is still booming, but that monthly figure masks the fact that sales during the past couple of weeks have been slowing down dramatically.”
While 15% year-over-year still sounds solid, it’s a misleading statistic given the current stoppage in both sales and inventory. Yes, inventory has also been pulled back according to Pasalis’ data. In the past week, new listings are down 33%:
Of course, the real estate market has seen much change in the past weeks as the reality of coronavirus has settled in. More virtual tours are taking place, open houses are all but extinct right now, and tenants and landlords aren’t exactly sure how April is going to play out.
While Toronto still remains a sellers’ market, a continuation of the market trend at the end of March into April could soon lead to a more balanced market, according to Pasalis.