In April of this year, the Ontario government implemented a 16-point plan to help tame the raging housing market in and around the Toronto area. This plan included a range of tactics from slapping on a 15% foreign buys tax to expanding the current rent control rules. Given this plan’s recent implementation, we’ve asked Christine Tetstall, an agent from Sutton Group Associates Inc. who specializes in the Toronto realty market, for her opinion on whether or not these measures are working.
According to Toronto Real Estate Board (TREB) President Larry Cerqua, there was a significant increase of 33% in new listings in April compared to April 2016. It was also stated that sales dropped by 3% since April 2016. These facts can be considered encouraging, giving hope that a more balanced market is on the horizon. Have the government’s imposed measures to cool the market already made an impact? Debatable.
I agree that there has been a slight slowdown in the market, however, I am not seeing a marked decrease in prices. There are still bidding wars, just less buyers competing with each other. For example, there may be 2 or 3 buyers bidding on the same property as opposed to 14 or 15. Accordingly, although there is more inventory, buyers still outnumber what is available, and prices are still soaring. As an illustration, TREB reported that the average selling price in April was $920k, compared to the average sales price in 2016 at $739k. Admittedly, there is more inventory and a slight drop in sales, but there has not been a notable drop in prices. It is plausible that the modest dip in the market may have been a response to the government’s imposed changes, and as legislation has not backed up the changes yet, the market could easily return to red hot.
|Christine is an agent with Sutton Group Associates Inc., Brokerage in Toronto. She specializes in the Toronto realty market. You can reach her by email at firstname.lastname@example.org or by phone at 416-966-0300. You can also find her online at www.christinetetstall.com.