TORONTO -- There are still some ‘For Sale’ signs on lawns in the Greater Toronto Area, but they are harder to find. Due to COVID-19, many buyers and sellers say there is just too much market uncertainty.
“People don't want to put their home up for sale because they don't know where they will go,” Pattie Lovett-Reid, CTV’s Chief Financial Commentator, said. “Some people who thought about buying before COVID-19 are now thinking I’m not sure I will have job, I’m not sure what the market will be like."
According to a report from the Toronto Regional Real Estate Board, compared to April 2019, the total number of homes sold plummeted by 67 percent. New listings were down by almost as much, falling 64 per cent. The average home sale price stayed about the same, moving up one-tenth of one per cent to just over $821,000.
While prices are almost flat compared to last April, they've dropped since March 2020.
“It’s a nine per cent drop in prices since March and so those homes that have been up a little longer, those sellers who really want to sell may be knocking back the price a little to get buyers coming through" said Lovett-Reid.
The fact that home sales and listings dropped together may have had a role in keeping prices relatively stable.
“You’re still seeing enough market tightness and enough competition between buyers who are in the marketplace to support selling prices more or less at last year’s levels” said Jason Mercer with Toronto’s Regional Real Estate Board.
Fewer listings and less market activity means there may be fewer bidding wars, which could lead to lower prices. Real estate agents must also rely on digital showings since open houses are still not allowed.
“The GTA market has basically stalled,” said John Pasalis, the president of Realosophy Reality.
Pasalis believes the next few months will help determine where prices are headed.
“This is one thing we are going to have to see in the next few months, who jumps into the market a little bit faster is it the buyers or the sellers and that is going to impact the balance we see in the housing market,” he said.
The impact of mortgage deferrals, consumer confidence and the strength of the economy in the year ahead will also have an effect on housing prices.
The report had some good news for renters. The cost to rent in Toronto dipped slightly last month. One-bedroom apartments dropped by 2.7 per cent and two-bedroom apartments dropped by 4.1 per cent compared to the same period last year.
The report says the decreases are a direct result of the pandemic.
