The Toronto real estate market is continuing to push forward despite the province-wide shutdown. Although limited, there have been new listings for many family homes and I suspect we will see more regardless of recommendations from the provincial government. As an essential service, real estate sales are operating relatively unimpeded for those who wish to participate.

For many years, the Toronto market has been extremely tight with demand outstripping supply. Due to covid-19, we are in a situation where there is even more pressure on the few available properties for sale. For good reason, people are less comfortable with strangers coming through their homes, while many people are still motivated to purchase and view homes when necessary. The result of this is further constricted supply. If you have a vacant house or can vacate your home for a short period of time, there is a financial case for putting your home on the market today.

Simply put, at this moment, it is easier to buy than it is to sell. As such, the market is active with investors, first-time buyers and/or renters looking to purchase. Primarily because Investors don’t need to sell during this shutdown, and neither do first-time buyers or renters. As a buyer, you can put an offer in and try to close in a couple of months when hopefully it is safer to move. If you are thinking about putting your property on the market, it would be ideal if it appealed to one of these groups.

A great example of the activity by investors is the renovation project featured last week that had 25 offers. An example of first-time buyer and/or investor activity is the renewed demand at the bottom of the condo market. There is more interest today in the $400K-$500K price range or the entry-level condos. An example of this is the unit at 25 Oxley, which I featured a couple of weeks ago (see below). It sat at $439K since November before selling this week for $445K. Suddenly there were competing offers on it. I am also seeing this play out in other units in this price range in desirable buildings. Last fall, realtors were being offered commission incentives to sell these units. Today, some realtors are holding back offers because of the increased interest.

As for renovated single-family homes, they continue to be the tech stock equivalent in real estate form. Last week I featured 29 Tiverton (see below), it sold for $1.6M, which is $200K more than the similar attached neighbour sold for in June. I also featured 153 Medland Street, a very nice renovated investment property in the Junction asking $2.0M, which sold for $2.2M. Only a couple of months ago, multi-unit investment properties were out of vogue.

Note that the only property I featured last week that hasn’t sold is the Argyle Loft. A unit with very little natural light, no outdoor space and a basic kitchen. Buyer’s priorities have shifted. Moving forward, deliberation on the purchase of a property, especially a condo, should include its suitability in a work from home environment.        

As an aside, much has been written about the negative effect a ‘work from home’ exodus may have on major cities. Although I am sceptical, I am not naive. In Toronto, I am hopeful that any exodus will contribute to a more balanced and predictable market. Although first and foremost, I encourage my clients to focus on properties with solid fundamentals or unique aspects from which they can create value and hold long-term, instead of relying on the market to continue to outperform.  

-Nick, Jan 22/2021