Etobicoke Real Estate Market Update – March 2019

We’re now two months into 2019, so let’s take a quick look at how our real estate market is performing this year. Each year is very different from the last and 2019 will be no exception.

Prices

Detached Homes

After three consecutive months of price decreases, the detached home prices increased in the first two months of 2019. On average, home prices increased 5% in the first two months of 2019 from the average price in 2018.

As we look ahead to the remaining months in 2019, we expect detached home prices to stabilize with a slight increase over 2018 prices.

Condos

On average condo prices have stabilized across South Etobicoke. Price changes tend to be building-specific; units in some buildings are still increasing in price, while prices of units in other buildings remain relatively flat or have even declined.

With more inventory of new condos continuing to come on the market and the tougher mortgage rules, we don’t anticipate seeing a significant increase in prices in 2019.

Units SOLD

Detached Homes

The number of detached homes SOLD in the first two months of 2019 was down 26% from the same period in 2018.

Condos

The number of condos SOLD in the first two months 2019 was up 17%% from the number of condos SOLD in the same period in 2018.  The higher volume of condos SOLD and stabilizing prices may be an indication that investors are deciding that now is a good time to take their profits out of their condo investment.

The ratio of the inventory of homes for sale versus the number of homes sold is an important indicator of supply and demand. A ratio of anything less than 4 typically means that we’re in a seller’s market. A ratio of 4-5  is a balanced market. A ratio above 5 is a buyers market.

Detached Homes

In the first two months of 2019, the ratios fell to 2.6 from the December 2018 high of 3.4 in the detached home market. Even though the February ratio declined from December, it was still higher than that of any other month in 2018. This means the supply for detached homes is getting closer to a balanced market. We’ll likely see fewer bidding wars in this market than we have in the past.

Buyers will shop the market looking for the best value with more choice of homes to preview. Sellers must make their home stand out in order to sell in a balanced market. Additionally, sellers can expect that the average time it takes to sell their home may be longer than what we’ve seen in prior years.

Condos

The ratio of inventory of condos for sale versus the number of condos SOLD reached his highest level since January 2018. This means the supply for condos is getting closer to a balanced market. We’ll likely see fewer bidding wars in this market than we have in the past.

Buyers will shop the market looking for the best value with more choice of condos to preview. Sellers must make their condo stand out in order to sell in a balanced market. Additionally, sellers can expect that the average time it takes to sell their condo may be longer than what we’ve seen in prior years.

Detached Home Market Trends

• We’ll see a more balanced market between buyers and sellers in 2019.
• Well-priced homes in popular neighbourhoods will continue to sell, some still with multiple offers.
• Most homes will be priced at market versus priced for a bidding war. Pricing your home correctly is critical in this market. Over-priced homes will simply sit on the market.
• Home price trends are really neighbourhood-specific with prices in some neighbourhoods increasing faster than in others.

Condo Market Trends

• The volume of condos sold was up in the first two months of 2019.
• Prices have stabilized after several years of increases.
• With the new mortgage rules in place and the higher average increase in condo prices, many potential first-time buyers are staying in the rental market.
• With a higher inventory of condos in the market, bidding wars are becoming less frequent.

The charts below give you a look at the trends in volumes and sales prices over the past year:

Etobicoke Average Sales Price of Homes and Condos

February  2018 – February 2019

Etobicoke Sales Volume of Homes and Condos Sold

February 2018 – February 2019

Detached Home Neighbourhood Average Prices Jan/Feb 2019

Condo Neighbourhood Average Prices Jan/Feb 2019

Our Tips for Buying and Selling This Spring

So what does this all mean if you’re thinking of buying or selling? We’ve got some tips to help you decide what to do.

1. Thinking of selling your home soon?

Many sellers have been holding off putting their home on the market in the hopes that prices will increase. We’ve seen five interest rate hikes over the last year which has affected home affordability.  The time may have arrived for those sellers sitting on the fence to get their home on the market.

Sellers will need to price their home right for the current market. There are buyers out there ready to purchase, but they don’t want to buy an overpriced home. It also needs to be staged to look its best and requires maximum exposure so that all potential buyers see it.

2. Are you looking to upgrade from a condo to a detached home?

Don’t wait; the time is now! You don’t want to look back in six months and think If only I’d made the move a few months ago. You’ll still get more bang for your buck than you would have this time last year. It really is still an ideal time to make a move.

The one potential downside of today’s market is that the inventory of both detached homes and condos for sale in Etobicoke is still low even though it has increased slightly. Many offers are now coming in with conditions. It’s advisable to work with an experienced agent who knows what conditions are problematic and which ones are fine.

3. Are you a first-time buyer and wondering where to start?

If you’re beginning your search, one of the first things to do is to get pre-approved for your mortgage. This way, you’ll know exactly how much you can afford and avoid disappointment. The best time for you to buy is yesterday and the second best is today. Don’t wait.

4. Are you deciding whether to buy or sell first?

We delved into this topic in a recent blog post, but in general, it’s a good idea to sell first. You’ll know how much you have to spend and you won’t have to settle for a lower price if the sale ends up taking a long time. If you do buy first, you could consider adding the sale of your home as a condition in your offer. Unconditional offers were the norm for a while, but sellers are more open to considering conditional offers in today’s market.

If you’re thinking about buying or selling in the near or far future, we’re here to help. Get in touch with us today!