Toronto Real Estate

Is Toronto Real Estate Following In Same Footsteps as Vancouver?

Steve Saretsky -

Homeowners Could Be Suppressing New Listings In Vancouver & Toronto

There’s been much chatter about the apparent bursting of the Toronto real estate bubble. Home sales have plummeted 37%, meanwhile the average sales price has sunk by 14%. Sounds awfully familiar to the Vancouver real estate market after the shock of a foreign buyers tax, doesn’t it?

In fact, you could argue things were even worse in Vancouver at one point. Back in January, sales in Vancouver had fallen 39% year over year, with the average sales price having plunged 24% from January 2016.

Since then, Vancouver has rebounded nicely, mostly thanks to a purge of new listings. There’s been an extremely close relationship between sales and new listings in Vancouver. As sales plunged, sellers refused to sell in a falling market, slowing the bleeding.

Vancouver sales to new listings
Sales and New Listings Forming a close relationship.

At first glance, it looks like Toronto is following a different path, sales have plunged and new listings are soaring, up 16% year over year for June…

Toronto sales vs new listings
Toronto Sales vs New Listings via Better Dwelling

However, recent data from President of Realosophy Realty, John Pasalis, suggests new listings are now beginning to trend downwards.

New listings in Toronto
New listings for Toronto condos have been trending down the past four weeks .
Toronto Detached new listings
New listings for freeholds are still up – but have been declining since April.

It begs the question, will Toronto homeowners follow in Vancouver’s footsteps and suppress new listings? Or will further policy intervention such as more stress testing coupled with interest rate hikes exacerbate the unwind…

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The Saretsky Report. December 2022