The March 2022 Toronto real estate numbers continue to make headlines and real estate continues to be a very hot topic of discussion. Each month when the numbers come out, I take a deep dive into what they really mean – beyond the headlines – to get to the real meaning of what’s happening in the Toronto market.
It’s important to have a solid analysis of the numbers, not only if you’re in the process of buying or selling, but if you’re investing, renting, or even a current homeowner. Knowing what’s really happening and what the numbers mean gives you information on the biggest investment of your life, and knowledge is power. It will help inform your next step if you’re thinking about taking one or find comfort in where you are now.
Let’s take a look at March.
March 2022 Toronto Real Estate: Detached Homes
The detached homes market in Toronto is on the move! After seeing the crazy January and February numbers, it is obvious that many sellers who were thinking about selling jumped and listed their homes for sale.
The number of listings on the market rose by 40% in March over February, and the number of sold transactions month-over-month increased by nearly 50%. So needless to say, there is a lot of trading happening within this segment.
The year-over-year prices of detached homes are up 2.4%, but the number of sold transactions year over year is down 24%. What this indicates is a full year of price increases, but demand is definitely starting to slow. You probably haven’t been hearing about those crazy bidding wars that were the norm earlier this year, right?
If you’re looking to purchase or sell in the lower-priced segment of the detached homes market, you’re in luck as these are moving the fastest and at market value pricing. The mid-range priced homes of around $2 Million will start to steady off once again and see a more traditional price increase in the single digits.
As we enter the warmer spring months, a flood of new listings are expected as is typical for this time of year. But I have a feeling this spring season will be slightly different than those crazy spring markets of the past couple of years. We’ve already hit peak frenzy earlier this year so I expect the spring market to be somewhat “normal”.
Sellers in this segment of the market tend to sell because they want to – be it upgrading, downsizing or anywhere in-between. Buyers will have lots of options to look at but be warned – there won’t be any “deals” out there. Sellers know the market value of their homes and they’ll be sticking to their pricing. Being in a position of wanting to sell versus having to sell gives an advantage to the sellers – they can hold off and wait until they get their price.
The benefit to the buyer? No more insane bidding wars with 40+ offers – those days have definitely passed so you’ll be in luck.
My advice for buyers: there is going to be a lot of inventory coming onto the market in the coming weeks, so know what your non-negotiables are (neighbourhood, bedrooms, bathrooms, yard, parking etc.) so you can make a decision quickly. The influx of inventory won’t last long, so buyers shouldn’t have that “wait and see what else comes out” attitude. Now is the time.
My advice for sellers: if you’re thinking about listing, list now. Get ahead of the market and all of the listings that are expected to come once the weather turns. You’ll want to be ahead of the competition by being on the market and making your home shine as best it can to attract those buyers looking right now.
March 2022 Toronto Market Stats: Semi & Row Homes
I say this month after month, but the semi and row home market is and remains one of the most stable segments in Toronto real estate. But things are definitely heating up as expected for this time of year.
Month-over-month prices are up 2%, while the number of new listings is up 33.5%, and the number of sold transactions is up 32%. Year-to-date prices are up 5.4%.
Year-over-year pricing is up 15.78%, but the number of sold transactions for the same period in 2021 is down 25%. This shows a full year of price growth, but demand is starting to slow as in the detached market – a very similar pattern.
With the news of the new mortgage rates, the semi and row home market will see the greatest impact as buyers will be looking for slightly more affordable homes. I’m not saying this segment will slow, but the trading homes will be at slightly lower price points.
Buyers within this segment and price range are usually the most price-sensitive, so buyers may have lower budgets than earlier this year. This is good news for the lower-priced semis that are well done and turnkey, as buyers will want to move quickly.
My advice for buyers: revisit your pre-approval if you’re currently looking to ensure your buying power hasn’t changed. I’d also recommend pulling the trigger if you find something you love because many will be looking in this segment as the spring heats up – competition will too.
My advice for sellers: if you’re listing, it’s more important now than ever before to stand out. Do those upgrades, add some fresh paint, think of small touches you can make to get buyers to fall in love. You’ll be happy when you have a quick sale and are able to move on to your next purchase quickly and easily.
Toronto Condo Market: March 2022
The Toronto condo market never really slows down – it’s one of the most dependable areas in real estate that consistently shows growth, steady prices, and a high number of trades. This is proven once again when we look at the March 2022 Toronto real estate numbers.
In March, the month-over-month prices are essentially flat, but the number of listings increased by 25% and the number of sold transactions is up by 55%. Year-to-date prices are up by 9.2%, and year over year, prices are up 14.57%.
A huge contribution to the increase in transactions was due largely to the mortgage rate hike which has been rumoured for quite some time. Many buyers wanted to confirm a purchase in order to lock in a lower mortgage rate.
In addition to that, many corporations and businesses are starting to return to the office, so those who participated in the pandemic exodus out of the city are realizing their work-from-home dreams aren’t a permanent reality. Many are returning to the city and buying new condos to live in.
One trend I am seeing is many mid to large size condos at higher prices ($800,000 – $1,200,000) that are being listed below market value and holding back offers, are missing their offer dates with zero offers to be looked at. Agents are then re-listing at market value and selling within 7 days of re-listing.
The reason this keeps happening is because of the number of listings on the market – buyers have plenty of condos to look at, even in that price range, and they won’t be forced into a bidding war. They are taking their time and finding the right condo for the right price.
But the benefit for sellers is even though this process can be scary and frustrating, prices are holding steady and no discounts are being given.
I expect the condo market pricing to stay on a steady track of increases – something that is stable and reliable, inventory levels to continue to rise as more sellers make the climb up the property ladder, and buyers to take longer to pull the trigger as they wait to see what else comes on the market.
My advice for buyers: don’t get caught up in a bidding war and pay more than you can afford. Work out a strategy with your broker so you have a plan when it comes to buying. Don’t be rushed because there are a lot of great condos available. I’d also recommend reconfirming your spending power so you have the latest numbers from your mortgage broker.
If you’re a first-time buyer looking to get into the condo market, don’t think that prices are going down. It’s not going to happen, plain and simple. Get into the market now – there are lots of options out there for you to consider.
My advice for sellers: staging goes a long way when it comes to selling your condo. A professional stager and your broker can showcase your home in a way that appeals to what buyers are looking for. It might not be how you live now, but staging can get you more money and a faster sale than without. Do some upgrades, add a neutral paint colour, and optimize your condo to appeal to the huge number of buyers that are out there now.
If you’re thinking about buying, selling, or investing and want to discuss strategies, pricing, timing, or anything else, simply complete my form on this page so I can get in touch with you right away. I’d be happy to answer any questions about the March 2022 Toronto real estate numbers you have or about the Toronto market in general and share my insights on what’s to come later this year.
~Romey Halabi
Founder & Lead Broker, Toronto Realty Boutique
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