The GTA Real Estate Market - get ready for it to climb again
The GTA real estate market has been pretty volatile in 2017. In the first 1/3 of the year, prices soared, sales were out of control, and most buyers couldn't get homes without bidding wars and frustration.
Then, according to many newspapers and "experts", Armageddon came. The bottom fell out and the future was seeming bleak.
Let's set the record straight. The market has not crashed, and the future is not bleak. The simple summary is this: it's summer.
Remember a few years ago, when there was a hot spring market and a hot fall market, and summer and winter were both slow? All that has happened is a return to the norm. Sadly, the timing of warmer temperatures coincided with the cooling of sales and the potential implementation of new governmental policies, which caused most to misinterpret the result. Clearly, during a summer market, sales numbers will typically decrease, and prices need to decrease from the insane levels they reached during spring to create a more ideal market (also known as an equilibrium). Finally, add a minor interest rate hike, and you have a number of ingredients contributing to this recipe for a decrease in sales.
Not all sales are down though - even through this "cooling" period, new condo sales have been hotter than ever. Second quarter new condo sales increased by 62% over 2016 according to Urbanation.
Fall is coming, and with it, more potential buyers will be back on the market, concentrating on their future homes. The "lower" prices are really just the market normalizing - homes are still above the value they were last year at this time. Buyers will come back and most likely drive up the prices again (not at the pace or level from the spring, but in a more healthy, controlled ascent).
If you have any doubts, look at Vancouver. Their "Armageddon" took place within the last year, and their market has already rebounded, with the biggest monthly price gain since 1990 recently reported according to the Vancouver Sun.
So the good news is we should be heading for a nicely balanced market, featuring a nice mix of buyers and sellers. Buyers will have a fair opportunity to obtain the homes of their dreams, while sellers will maintain the ability to sell for a fair market price.
Of course, if you're buying or selling and would like an excellent and skilled real estate agent to help with your sale, purchase or both, we're always happy to hear from you.