TORONTO — November brought a sense of urgency to the Toronto real estate market, where COVID-19 has people buying and selling homes for “completely different reasons” than before the pandemic, according to Peel-based broker Bethany King.
With schools restarting in January and many children and parents home for remote learning during the COVID-19 pandemic, buyers were willing to push their budgets to get a more spacious home in place for the new year, says King, a team leader at Century 21 Millennium Inc. brokerage.
“A huge draw to being in the city was all of the things that happen in the city,: the festivals, the nightlife, parties and gatherings. But all of that is gone now,” says King. “A lot of people don’t see the value in living in a place with so little square footage.”
Pockets of listings have also cropped up from sellers facing down lingering unemployment from the COVID-19 pandemic, as the period for deferring mortgages draws to a close, said King.
“It’s a mixed pot. In regards to new listings, I do believe that our new listings are driven by financial need,” says King.
“But regardless, our inventory is still low. In our suburban areas, we’re still seeing bidding wars. It’s highly competitive and our properties are not sitting for too long.”
King’s comments reflect new data from the Toronto Regional Real Estate Board, which showed that November home sales in the Greater Toronto Area were up 24.3 per cent compared with last year, as demand for single-family homes continued to surge ahead of condos.
There were 8,766 homes sold in the month, up from 7,054 in November 2019, the board said on Thursday. The average price was $955,615, up 13.3 per cent from $843,307 a year earlier.
Board president Lisa Patel says homebuyers continued to take advantage of very low borrowing costs in November, especially those looking to buy some form of single-family home.
While detached home prices rose to an average of $1,202,281, up 15.2 per cent from November 2019, average condo prices fell two per cent to $605,863.
Compared with November 2019, average prices were also rising more quickly in the suburbs than in the city’s core, with detached home prices up 19.2 per cent, townhouse prices up 14.9 per cent, and condo prices up 4.8 per cent in the suburbs.
In the city centre, detached home prices rose 8.7 per cent, townhouses were 7.3 per cent pricier, and condo prices fell three per cent from Nov. 2019.
Even as news of a potential COVID-19 vaccine mounted in November, Toronto-based broker Jasmine Lee says many buyers have their minds made up to leave the downtown core.
“Torontonians are exploring more outside of their city. We have clients who said things like, ‘We don’t travel north of Bloor,’ and now they’re travelling to Ajax or Oshawa,” says Lee. “I think this is going to be a big trend we’re seeing now and in the future.”
Low-rise, suburban homes have been increasingly popular since the start of the COVID-19 pandemic as telecommuting and stay-at-home restrictions have left buyers seeking space over the convenience of downtown.
So far this year, sales of detached homes in the Toronto area are up 13.1 per cent from 2019 despite a near-shutdown of sales this spring, while condo sales are down 10 per cent so far this year.
The number of condos that hit the market this November was almost double that of November of last year.
“My buyers … are comfortable with abandoning their downtown Toronto condos, to get something big — more substantial — in the suburbs,” says King, although she noted that could change with the government’s plan to add 401,000 permanent residents to Canada’s population next year.
“This so-called condo crash may just be a short blip in our 2020 COVID-19 real estate market.”
The board said 11,545 homes were listed for sale in November, up from 8,651 in November last year, as the market catches up from spring’s slowdown. There have been 150,913 listings in the Toronto area so far this year, compared with 149,241 at this time last year.
Although there was an uptick in condo listings, Lee says that the harried summer and fall in the real estate market is in part due to a shortage of homes on the market, even dating back to the beginning of 2020.
Homes are spending about 20 per cent fewer days on the market this year compared with last year, the board said.
“It seems like something bigger than a pandemic would have to happen in order to shut down the real estate market,” says Lee.
This report by The Canadian Press was first published Dec. 3, 2020.
Anita Balakrishnan, The Canadian Press