Toronto house sales and prices tank as new lending rules bite

By Leith van Onselen

The wheels continue to fall off Toronto’s housing market, according to the Toronto Real Estate Board (TREB):

Greater Toronto Area REALTORS® reported 7,228 residential transactions through TREB’s MLS® System in March 2018. This result was down by 39.5 per cent compared to a record 11,954 sales reported in March 2017 and down 17.6 per cent relative to average March sales for the previous 10 years.

The number of new listings entered into TREB’s MLS® System totaled 14,866 – a 12.4 per cent decrease compared to March 2017 and a three per cent decrease compared to the average for the previous 10 years.

“TREB stated in its recent Market Outlook report that Q1 sales would be down from the record pace set in Q1 2017,” said Mr. Syrianos. “The effects of the Fair Housing Plan, the new OSFI-mandated stress test and generally higher borrowing costs have prompted some buyers to put their purchasing decision on hold. Home sales are expected to be up relative to 2017 in the second half of this year.”

The MLS Home Price Index Composite Benchmark was down by 1.5 percent on a year-over-year basis for the TREB market area as a whole. The overall average selling price was down by 14.3 per cent compared to March 2017.

Those are some bearish indicators right there.

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Comments

  1. reusachtigeMEMBER

    Toronto, who would want to live in that ice block? They don’t have good beaches and warm weather with a friendly go-getting vibe like Sydney does. That’s why we won’t see that sort of thing here.

    • SoMPLSBoyMEMBER

      Oakville (suburb of Toronto) median resi price down 26.4% in Feb 18 v Feb ’17.( C$920k v C$1.25k)
      Some pretty sorry stories emerging now in parts of CA when the laughter turns to sorrow.
      The fallout naturally takes longer to reach Straya but it’s coming for sure.
      http://www.greaterfool.ca/

      • Mining BoganMEMBER

        I’m happy we have an ending of sorts. Betcha Derek still has trouble getting the money though. That’ll teach him to deal with RE types.

        I’m waiting for Straya’s Dereks to come forward. They’re out there somewhere, all concerned and ulcered.

      • GeordieMEMBER

        Interesting to note the end the author expects:

        Recall, you were told this day would come. For years the warning has been the same: there will be a correction, then a melt. But no US-style property Armageddon. No 50% decline. No 70% Phoenix-style Hoovering. The only way such an event could occur would be if conditions here mimicked those in the States when that market crashed. A serious recession. Double-digit unemployment. No available credit. And a housing market where people were too pooched or terrified to buy.

        My feeling is, without external shock, that this will be the way of Sydney and Melbourne. A kick down in prices then stagnation or slow decline. However, Canada is in better shape to deal with a tanking property market than is Australia, where it is pretty much the only game in town, one way or another.

        At what point do defaults, distress sales and cutting back on all manner of consumption cause a self-invoked meltdown? I supposed if we could measure and predict that we’d be very well off.

      • Lol, so the Canadian calamity that greaterfool has been calling for us just giving back of ONE YEAR’S gains?

        That’s pretty laughable.

      • BrentonMEMBER

        Someone that bought a year ago is -14.3% in the red on a million dollar mortgage. How far back just to break even? I’m sure they’re all laughing their sides out, Peach…

      • Rational RadicalMEMBER

        Give it up peachy, only six months ago you were continually scoffing that only year on year price falls would mean anything. Now you wanna move the goal posts?

        I knew there was good reason to ignore your constant BullBear wishful thinking. As bad as the rewriting of history that the true bears are continually accused of.

        Hundreds of thousands of dollars off peak price is as real as hundreds of thousands in rising prices. Next you’ll be telling us that the Pascometer is just misunderstood, and that Ruesa is not actually ironic…

        C’mon dude. When the facts “change”…
        Maybe it’s just seasonality…?! LOLOLOL

  2. Toronto Real Estate’s Harsh New Reality: Buyer Beware … Huffington Post

    https://www.huffingtonpost.ca/2018/04/07/toronto-real-estate-new-reality_a_23405449/

    Until recently, Greater Toronto’s housing market had been something of a fairy tale. Years and years of price growth convinced many that buying into the market — at any price — would pay off. In essence, a house in Toronto had become a miracle investment: no matter what happened, you made money.

    But now, with home sales in the metro area down nearly 40 per cent over the past year, and prices down 14 per cent in that time, the market is doing something it hasn’t done in a good three decades: It’s creating losers. … read more via hyperlink above …
    .
    .
    Greater Toronto Home Sales Drop Nearly 40%, Vancouver Sales Down Almost 30% … Huffington Post

    https://www.huffingtonpost.ca/2018/04/04/toronto-home-sales_a_23402704/?utm_campaign=canada_newsletter

    • BrentonMEMBER

      Going off the plummeting* sales and skyrocketing* listings, I’d say nobody.

      *not even hyperbolic, just an accurate description

    • Torchwood1979

      Because prices won’t be down for long, this is the one and only opportunity to buy before it goes BOOM again! Get in now or be locked out FOREVER!!!!!!!!!!!!

      How did I do? My job sucks at the moment, thinking a career in RE could be a goer.

      • You have to have the balls to put your money where your mouth is though.

        No I don’t mean buying property, I mean a more-than-your-salary novated lease benz and a pin stripe suit.

      • SoMPLSBoyMEMBER

        Pretty good, pretty good!
        You have the ‘tell em what they want to hear’ part down, but I sense you’re more drawn to the sell side and ‘helping’ good folks get out before the equity vaporizes. Nothing motivates inaction like fear!

      • You did great! RE is the only career that requires no skills. I challenge people to find another example, but almost impossible 🙂

      • Can’t lose triggering FOMO & Greed. Get them hot to sign before they walk down the driveway & you won’t even have to bother with the haggling.

  3. tripsterMEMBER

    I think it was far more palatable for Toronto and has caused much less (if any real damage) because the government acted so quickly. Instead of prices climbing, climbing and climbing for years – the government acted quick and deflated the bubble for it could really grow a great deal.

  4. Steve Keen asserted many years ago that house prices were greatly influenced by the change in availability of mortgage funds. The Toronto experience seems to support that.

  5. Time to put money in a safety deposit box. When it hits who knows if we can get our cash. I don’t trust the government’s promises.

  6. Someone on this site linked to “Mike Martens” on youtube – I’ve followed him since, he’s not a smart guy, at all but he is a normal guy living there, who is pretty pissed about the housing market. Often get news from him and the Toronto subreddit.

    Interesting the Canadians and Aussies are similar in their “PC-ness” and immigration problems, despite the Canadians being infamous for being so polite, you can, finally find Candians who are frankly @#$%ing angry about the Chinese buyer problem and willing to discuss it, angrily. The political correctness is slowly taking a backseat as people angrily flee Vancouver and Toronto their lifetime homes, that they can’t afford to live in.

    Fingers crossed we get it here too, we need to run the Chinese out. (We actually have it worse, since we have Negative Gearing on top of it)

    • Nice evolution:
      – prices will never fall
      – prices will only fall in some isolated regional towns
      – prices might fall in some cities but never in Sydney
      – prices in Sydney will only fall in some suburbs
      – price falls across the board in Sydney are modest, in fact they are a healthy correction.
      – Prices in Sydney will never crash.
      – (Australia YOU ARE HERE)

  7. NEW ZEALAND: WHEN CAN AUCKLAND TEACHERS HAVE AFFORDABLE HOUSING MINISTER TWYFORD ?

    South Auckland teacher commutes 180km a day because of housing costs … Fairfax / Stuff

    https://www.stuff.co.nz/national/education/102707618/south-auckland-teacher-commutes-180km-a-day-because-of-housing-costs

    Buying a house is next to impossible, teachers in south Auckland say.

    Kaveeta Shiriwastow’s day starts in Thames at 2.50am just so she can make it in time to her teaching job in Manurewa. She has to complete chores, get herself and her two sons, who are of different ages and attend different schools, ready for the day.

    Driving the 180 kilometre return trip daily leaves her with little time for her boys. … read more via hyperlink above …

    … Teachers … ask Minister Twyford when this is going to happen …

    Housing – New Zealand Labour Party

    http://www.labour.org.nz/housing

    … extract …

    Remove barriers that are stopping Auckland growing up and out

    Labour will remove the Auckland urban growth boundary and free up density controls. This will give Auckland more options to grow, as well as stopping landbankers profiteering and holding up development. New developments, both in Auckland and the rest of New Zealand, will be funded through innovative infrastructure bonds.

    … so that affordable new housing is ALLOWED ( yes … that’s all ! ) to be built. Note these Pulte Homes. Phoenix, Arizona, USA examples (building areas quoted are ‘heated areas’. Add approx 36 square metres or 388 square feet for double garage). Then compare with current new Auckland prices …

    Pulte Homes Suburban Development Phoenix Arizona

    https://www.pulte.com/homes/arizona/phoenix/florence/parkside-at-anthem-at-merrill-ranch-7739#CommunityDetailsView

    … Distribute & discuss (PARTICULARLY WITH TEACHERS) … thank you …

    • New Zealand is very very much suffering the bloody China effect as much as us. They have wide open borders, the Chinese are hammering in at an insane rate, what a surprise, housing is off the charts.

      They’re double screwed too, because Chinese are not only flocking to NZ to escape China, there’s an extra batch flocking to NZ to end up being able to move to Australia easier through immigration loopholes.

      CLOSE
      THE
      GATES