— We take our content seriously. This article was written by a real person at BREL.
Buckle up, buttercup: the Toronto 2020 spring real estate market is HERE and it’s FIERCE.
Take a peek at the numbers below and then scroll down for our Spring Market Buyer and Seller Survival Tips.
February 2020 Volume of Sales is WAY WAY up vs. February 2019
Our thoughts about sales volume: 2020 sales numbers show an extremely active market, but…February 2019 was abnormally slow, and the spring market woke up later last year. But still, we’re off to a great start in the 416 and the 905.
February 2020 Average Sales Price is WAY up vs. February 2019.
Our thoughts about average prices: Double-digit increases all around – wowzers. The 416 is on fire. The 905 is on fire. Condos in both the 416 and the 905 were the biggest winners of all.
Related: See the full February 2020 TREB Market Watch Reports here.
When I dig a little deeper in the market statistics, I see that:
- Toronto has less than 2 months of inventory in central Toronto- meaning it would take less than 2 months to sell all the houses currently listed for sale. Sorry Buyers, but Sellers are firmly IN CHARGE of this market.
- Properties are selling ridiculously fast – 30% faster than they did last February.
- The average property across the GTA sold for 102% of asking.
- East Toronto properties sold for 109% of the asking price. In the E1 MLS District (Leslieville/Riverdale/Riverside), the average home sold for 114% of asking. 😳
- West Toronto properties sold for 104% of asking. The W2 MLS District (Roncesvalles/Junction/High Park/Runnymede/Baby Point) and W3 District (Corso Italia/Caledonia Fairbank/Rockcliffe Smythe) both saw the average sale at 110% of the asking price.😳
- The hottest markets in Toronto are both home to BREL offices. Coincidence? 😜
GTA Buyer Survival Tips: 2020 Spring Real Estate Market
If you’re a Buyer this spring:
- Be ready for ‘offer night’. Because there are so many more Buyers than Sellers right now, multiple offers are the norm, so most Toronto Sellers are setting ‘offer nights’ – meaning they won’t look at offers until 6 or 7 days after a home is listed, in the hopes that multiple buyers will bid.
- Be ready to move fast. Not all homes have an offer date though, so sometimes, you can scoop something up right away. These days, we’re seeing properties selling before they are even officially listed for sale on the MLS, and we’ve seen more than a few spontaneous bidding wars materialize just a few hours after a home is listed for sale. Make sure you’re approved for a mortgage, have your deposit ready and be ready to look at a home as soon as it’s listed for sale. And obviously, work with an agent who is fully aware of what’s happening.
- Bring bags of money. When prices are increasing as fast as they are right now, be ready to pay significantly more than the last sale, and often, a lot more than the asking price. Make sure to work with an agent who can help you understand what’s really happening to prices and why, and knows how to win in this market. Offers that were hundreds of thousands of dollars more than asking were common in February and we saw more than a few condos sell for 20% more than the identical units sold for in the fall. Bananas.
- Supercharge your offers. Have your deposit in hand. Go in with no conditions (meaning you need to arrange your financing and take care of any home inspections before offer night). Give the Seller the closing date they want. Strategy is key to winning a bidding war. Read our Supercharge Your Offers blog for more tips.
- Don’t be afraid to be a bully. If you’ve fallen in love with a home, it’s possible that the Seller will consider your offer before the ‘offer date’ – but it’ll need to be so good that they can’t pass it up. Read more about Bully Offers here.
- Be ready to respond to a bully. Don’t assume that the offer date is the offer date – another Buyer might make a bully offer and you’ll have only hours to respond. If you’re interested in a home, make sure your agent knows it.
- If you find yourself in a condo bidding war, make sure you’re ready. Read more about Winning a Condo Bidding War here.
- Talk to your bank or lender about appraisals. If you’re paying significantly more than the last comparable sale or a lot more than the asking price, the bank’s appraiser might not agree with how much you paid, which might mean you have to come up with more money or revert to Plan B. Read All About Appraisals here and make sure you’re ready if your new home doesn’t appraise at what you paid.
- Don’t get so caught up in the frenzy that you forget to weigh the risks:
- The Bank of Canada cut interest rates today (March 4, 2020). Lower interest rates are great for Buyers, but signal nervousness about the overall economy. And what goes down must eventually come up, so be careful not to over-extend yourself and borrow too much money – you want to be able to afford your mortgage payments when rates go up too.
- The impact of COVID-19 Coronovirus is still unknown (both to our health and our economy). It could bring everything to a halt temporarily – or have no impact at all.
- A US election year always makes for interesting economic times.
GTA 2020 Spring Market Seller Survival Tips
If you’re a GTA Seller: Yay you! But don’t let cockiness or greed get in the way of having a successful sale.
- You still need to prep your home, stage it and hire a REALTOR who knows how to market your home beyond the MLS – that is, if you want to sell it for top dollar.
- While it might feel that anything will sell at any price right now, that’s simply not true. Over-priced homes are still sitting on the market.
- While it may be fun to see a big number on an offer for your home, what’s most important is the Buyer’s ability to actually close on the purchase – and financing issues and appraisals are common in a super hot market. Your agent can help you reduce this risk.
- The last time the market was this crazy (spring 2017), it all came to a screeching halt when the government intervened. If you’re worried about a change in the market conditions, make sure you get a big deposit and a short closing time period. Too many Sellers learned those lessons the hard way in 2017.
If You’re Buying and Selling at the Same Time:
There’s no easy answer as to whether you should buy or sell first in this crazy market, but:
- If you’re upgrading and prices continue to go up, you’ll want to buy first and sell later.
- If you’re downsizing and prices continue to up, you’ll want to buy first and sell later.
- If you’re worried about where the market is headed, you may want to sell first and lock in your return.
- If you’re moving out of Toronto, get on the market while demand is still strong.
We look at everything you should consider in our blog: Should You Buy or Sell First?? Read it.
The spring 2020 real estate market is here and it promises to be an interesting one across the Greater Toronto Area. Sign up for our blog or follow us on Facebook for all the latest news and gossip.