Following the quieter summer season, the fall market is traditionally a busy time for buying and selling homes. Even though Labour Day — the unofficial end of summer — has passed, condo sales in the Greater Toronto Area are yet to pick up during this traditionally busy season, according to a new research report issued this week by Strata.ca.
The week of September 13th saw 767 transactions, but sales began to decline in the days following. This means that the hot fall market hasn’t arrived yet, according to the Toronto-based brokerage.
According to Strata.ca, the GTA has reported around 2,480 sales so far in September, which is 25% less than the 3,113 transactions recorded in August. This month’s sales are also 20% lower than in September 2020, when 3,101 units were sold.
Since the market peak in March, when 1,033 condos were sold, downtown Toronto condo sales have been slow to catch up.
A similar tendency has been observed in the GTA suburbs, where the outflow of Torontonians to the outskirts has slowed. This month, for example, 29 and 39 condos were sold in Oshawa and Hamilton, respectively. This is a 52 percent dip from Oshawa’s peak in March, and a drop from Hamilton’s average of 72 sales each month since March.
Condo prices, on the other hand, have never been higher, according to Strata.ca. In the GTA, the average cost per square foot is currently $797, or $703,000. Since peaking in March, prices have remained stable. Despite the fact that this can be advantageous to sellers, purchasers have yet to catch on.
“Those who were looking to make big real estate moves this year already did so during the spring market,” said Alex Hood, a real estate agent with Strata.ca. “But monthly sales have been declining ever since with barely 500 transactions so far in September.”
“The fall market hasn’t happened yet because housing prices are simply out of reach for most people,” said Cliff Liu, a broker with Strata.ca. “You have no choice but to bury your plans if it doesn’t make sense to spend 1.1 million on a two-bedroom townhome.”
Liu went on to say that sellers frequently have “unrealistic expectations,” which drives purchasers away. Some sellers are still not flinching, even after some of his customers have placed low-ball bids on houses that have been on the market for nearly 200 days, but they may be “forced to re-adjust their prices regardless if the fall market refuses to kick in,” according to Liu.
According to Hood, this September appears to be calmer than usual compared to previous years’ “generally bustling” pace. The lag, according to Hood, is due to Ontarians still adjusting to life after the lockdown.
For other people, coming from lockdown has translated to post-pandemic job uncertainty, according to fellow Strata.ca agent Sam Massoudi. Some of his clients, according to Massoudi, are still debating whether they need to incorporate office space or relocate closer to their business.
Hood believes that the fall market can still take off, despite the fact that it is “happening a few weeks later than usual.”