October, the month of turkeys and scary monsters, was anything but a turkey or a fright for the real estate market. October saw a huge increase in the number of home sales over October 2008, and prices shot up as well.
Existing home sales in Toronto increased to 8,476 in October, which was up a whopping 64 percent from October 2008. In addition, the average home price in October was a staggering $423,559, which was an increase of 20 percent over October 2008. This is the highest on record according to the Toronto Real Estate Board.
It is not all good news though. Listings were down quite a bit, falling by 46 percent when compared with October 2008. This is not good news because it means that there are not enough homes being listed, but many people looking to buy homes. This creates a seller’s market, which means higher prices for buyers thanks to bidding wars and a shortage of supply.
As well, while it may seem like the market has rebounded significantly, home sales are only at 74,721 in 2009, which is only nine percent more compared with the first 10 months of 2008.
This means that everything needs to be put in perspective. From January 2008 to September 2008, sales were high and prices were high. However, prices fell significantly after October 2008 and continued falling until about May 2009. Therefore, home prices and sales from June 2009 to October 2009 mirror those of January 2008 to September 2008. This causes the values to even out and that is why even though double-digit growth in the market has been seen since July 2009, only a nine percent growth has happened over the course of the entire year.
That all being said, this does show there is more confidence in the market and that there are more people looking to buy homes. The reason for the drop in home listings is the lag time between worry and confidence. As more and more buyers become confident and want to take advantage of the high home prices, the overall number of listings will increase, thereby causing the average home price to fall to a more logical number.
Things are looking up for 2010 for the Toronto Real Estate market, and it seems that rosy days are indeed in the future for buyers, sellers and realtors alike.
Posted: 2009-11-09 08:49:18
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