“The market still favours sellers. For the month of May our numbers are still up,” Dianne Usher, SVP Johnston & Daniel, a division of Royal LePage, told CREW. “We’re predicting we’ll see double-digit price increases by the end of the year in the GTA.”
If that proves to be the case, the cooling of Toronto’s market will have lasted less than a year.
However, it remains to be seen how buyers and sellers will react to the current reality.
GTA sales activity fell 25.3% month-over-month in May, according to the Canadian Real Estate Association, with a total of 10,196 homes sold.
That also marks a 20.8% year-over-year drop. Many are pointing to the recent Ontario Housing Plan, which included a number of housing measures aimed at cooling the market and addressing affordability, as the reason for buyer pessimism.
The average price, meanwhile, was up 14.9% year-over-year in May – jumping to $863,910.
New listings were up 48.4 year-over-year, as current owners look to cash out.
And while interested industry players may be singing an optimistic tune, the ultimate impact of the Housing Plan remains to be seen.
“The actual, or normalized, effect of the Ontario Fair Housing Plan remains to be seen. In the past, some housing policy changes have initially led to an overreaction on the part of homeowners and buyers, which later balanced out,” Jason Mercer, TREB’s Director of Market Analysis, recently said. “On the listings front, the increase in active listings suggests that homeowners, after a protracted delay, are starting to react to the strong price growth we’ve experienced over the past year by listing their home for sale to take advantage of these equity gains.”
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Toronto’s market has shown signs of cooling, but how long is it expected to last? Not long, according to one industry veteran.