Michael Alexander Smith – Real Estate Broker at Berkshire Hathaway HomeServices
Each Executive Summary Report is for a specific TRREB zone combination and includes a map of the included zones and a 1 page summary for each property type (detached, semi-detached, townhomes, condos)
The Information / statistics you can find in each Executive Summary Report include:
The Olympics are close and the TRREB market is on pace for a personal best. Given the torrid pace set at the beginning of the year, many believe a slow down is inevitable. The challenge will be identifying if (or when) a gradual slowdown transitions into a market correction.
So, how did the market fare in June? While no world records were set, June still clocked near record levels for the month. The media did a good job refraining from any “sky is falling” headlines leading with quotes such as:
In this month’s edition of The Monthly Outline, we go beyond the headlines and explore the underlying data. What’s driving current market conditions and where do things go from here? In the Mortgage Outline section we analyze the recent Bank of Canada’s monetary policy and interest rate announcements (July 14th) to determine what it means for interest rates moving forward.
Looking for more information by specific property type or TRREB zone? Scroll to the bottom of this email for links to the Executive Summary, Power Pack, and Stats Outline reports for over 38 different TRREB zone combinations.
10 Year History of Sales and New Listings
Given seasonality trends, the month of June is typically slower than May. How did June 2021 shape up?
416 Sales / New Listings Summary
905 Sales / New Listings Summary
Year-To-Date Sales & TRREB Revised Forecast
Average Price Taking The Summer Off
Overall, TRREB’s average price remained at a near record level coming in at $1,089,536 for the month (up +17.0% vs. June 2020). We have, however, started to see a levelling off over the past number of months as buyers/sellers try to determine our new normal.
With a longer term view in mind, the 3-year compound annual growth rate (CAGR) in average price was 10.5%, 5-year CAGR was 7.8%, and10-year CAGR was 8.7%.
With respect to property types, detached homes led the way with a year-over-year increase of 24.7% capping off a wild 12 months. While inventory levels remain low across the board, it will be interesting to see if the areas that have climbed the fastest/highest will be sustainable, or if we will see an eventual pull-back. Territory specific detached year-over-year average prices:
*Old City of Toronto Zones Include: C01, C02, C03, C04, C08, C09, C10, W01, W02, E01, E02
*”416″ Zones Outside of Old City of Toronto Include: C06, C07, C11, C12, C13, C14, C15, W03, W04, W05, W06, W07, W08, W09, W10, E03, E04, E05, E06, E07, E08, E09, E10, E11
While detached/semi/townhome prices have skyrocketed over the past 12 months, condo prices remain relatively flat with pre-pandemic levels (and in fact, are still lower in the Old City of Toronto zones). We anticipate a slow shift in the medium term (6 to 12months) where condo average price will begin to outperform other property types as the economic reopening progresses forward, immigration starts to ramp up, downtown living & elevators become convenient again, and a potential reverse wave as people relocate back to the core.
Where do things go from here?
As we enter the summer months, we should expect to see a continued month-over-month slow down given typical seasonality (July is typically slower than June).
Key takeaway? Overall, inventory remains at near record low levels (i.e., “905” detached active listings are -54% below the 5year average for a June, and 416 is -32% below) . The only exception is “416” condos were inventory is slightly higher than the 5-year average, but absorption rates are picking up speed. If nothing changes over the summer months, we could see prices march upward again in the fall as the usual fall uptick in demand chases a limited supply of properties.
Bank of Canada Interest Rate Update
On eight scheduled dates each year, the Bank of Canada issues a press release announcing its decision for the overnight rate target, together with a short explanation of the factors influencing the decision. This announcement can provide critical insight into the economy as well as the future timing and direction of fixed and variable mortgage rates. The most recent announcement was on July 14th and key quotes were as follows:
Key takeaways? In summary, the Bank of Canada (BofC) reiterated its stance about an expected economic rebound but does hedge this statement with warnings about COVID-19 variants. The BofC also projects the housing market to ease back from historical highs. With respect to the impact on mortgage rates:
For any mortgage related questions or requests, please contact any member of the Outline team as we are always on standby to help.
|Executive Summary (5 Page Report)|
On the go? The Exec Summary Format provides 1yr/3yr/5yr/10yr comparisons across all key TRREB metrics in a “one-page-per-property” type layout. Details for the current month, year-to-date, and rolling 12-month totals and historical comparisons are also included.
|NEW! Power Pack – 17 Page Report|
The latest (and we think greatest!) addition to the collection. This report includes everything from the Executive Summary Tables, plus some amazing charts/visuals for all major metrics including: sales, new listings, active listings, sales-to-new-listings ratio, months of inventory, average price, and sale price to list price.