I hope you had a lovely holiday season and are having a great start to 2019. As for my holidays, they were quite relaxed, spending time with family and friends, and not working much for a couple weeks. It was some welcome downtime with it being a busy and successful year helping clients buy and sell real estate. Many thanks to those of you that choose me to help you, as well as those that recommended me to your family and friends.
In 2018 I made a couple of appearances on the Marilyn Denis Show and I was able to set up a couple clients to be featured on the show as well, it was an exciting adventure! If you didn't catch the episode in October, I went home shopping with a couple of clients and joined Marilyn in studio to go over some tips for first time home buyers. If you missed that, you can watch here: https://www.marilyn.ca/Home/Articles/October2018/5-steps-you-need-to-know-if-you-re-a-first-time-ho?fbclid=IwAR1XasK5ZxMtxBAt2_u-coGgQoqCRV02RXfUnt1klK9GzERiNjFiSi2XHKY
So how was the real estate market in 2018? In short - it depends. I know, I know, what a cop out answer haha. But it does really depend on which area of the GTA you're talking about and which property type. Today I'll start with an overview of some of the numbers for the GTA as a whole, along with a historical comparison.
The Toronto Real Estate Board (TREB) reports on the areas across the GTA from Burlington in the West, out to Oshawa and Clarington in the East, with the areas just before Barrie as a Northern border. The overall average selling price for 2018 transactions, at $787,300, was down by 4.3% year-over-year for all home types combined across the TREB market area. This was the first time since 1996 that the annual average sales price dropped year over year:
I'm sure there will be some conflicting opinions about what the data in the chart above means, and I imagine those interpretations could guide people to make completely different decisions in 2019. I don't find the 4.3% drop in average sales price for 2018 to be that concerning, in the context of the very heated couple of years leading up. The first quarter of 2017 was the peak of real estate mania across the GTA, with some of those early 2017 months posting average sales prices that were up 30-34% over the same month in the previous year. It was unsustainable but nobody knew just how long it would last. Then the government implemented a foreign buyer tax and other fair housing regulations on April 20th, 2017, which caused the market to shift drastically and prices to start dropping in a lot of areas. However, by the end of May 2017, there were already 46,591 home sales, which ended up being just over half of all the home sales for the year. So the 2017 average sales price across the GTA was bolstered by these strong prices up to June, and that's what helped to keep it above the 2018 average sales price, in combination with the pretty flat year we've had. One figure that I didn't include on that chart, is the increase from 2008's average sales price to 2018's - there was an 82.5% increase in the last 10 years!
I've charted the average home sales price by month, for 2016, 2017, and 2018. Notice the green peak representing the first quarter of 2017:
Keep in mind that while the average sales price is generally higher in the peak spring and fall months for each calendar year, I wouldn't say that it means you should time your buying or selling around this typical trend. The reason I say that is because one school of thought is that during the peak spring and fall market months, there is generally an increase in very expensive homes being sold, which works to bring the average sales price for those months up. The timing of listing your house or buying would also be dependent on the current conditions in the area, for the property type you're working with.
To summarize 2018 with a broad brush, there were significantly less home sales across the GTA (16% less than 2017 and 31% less than 2016) and prices were pretty flat. As I mentioned at the beginning though, certain areas and property types performed well, while others saw a drop in prices and an increase in days on market. That's what I'll be looking at later this week in Part 2 of "What Happened to GTA Real Estate in 2018?" so watch out for that email.
Thanks for reading and if you're looking for real estate advice specific to your property or what you might want to purchase in 2019, send me an email.