The GTA real estate market was showing all the signs of a tremendous spring run; demand was once again exceeding inventory, and competitive offers were making a comeback. Things have changed significantly over the past two weeks, with a stillness descending on the market while everyone comes to terms with the COVID-19 pandemic.
While the real estate industry was deemed an essential service when the province declared a state of emergency, it is anything but business as usual. We are allowed to take on new listings in the event an owner needs to sell, typically these are individuals who purchased a new home or sold their existing home prior to Ontario declaring a state of emergency.
The introduction of social distancing has redefined our industry; many of our meetings have become video calls; buyers are subject to extensive surveys if they must conduct a showing. Many buyers are resorting to submitting offers based purely on photos or video tours.
This market shift has had a significant impact on market traffic, as our office recorded a 77% drop in showing activity when comparing the first week of March to the last week of March. It is important to note that this does not account for individuals making offers solely off of photos or videos.
We have also analyzed the numbers for a wide variety of markets ranging from Toronto to Grimsby. When comparing March 1-14 vs. March 15-31, we saw a 48% drop in sales, compared to a 31.5% increase that we saw when comparing the same periods last year. More importantly, however, we saw the days on the market remain steady at ten, and the sales to list price ratio only fell .7% to 99.83%.
What does all of this mean? Fewer people are listing their homes, and fewer people are purchasing. However, the buyers who are out in the marketplace are serious purchasers continuing to drive healthy numbers. This is a relief for people who’s move was put in a precarious situation by the COVID-19 pandemic.
What will be telling are the statistics over the coming months, some experts are predicting that we will see a spring market re-emerge once this passes with heightened economic activity. Others are more skeptical and believe that it could take several months before buyers re-enter the market.
While we appreciate that for many, the real estate market is not of primary concern for some, many of our clients are concerned about the forecast, whether they be investors or people who’s finances have been negatively impacted by the disruption COVID-19 continues to cause. We will keep you posted on the monthly statistics, with more frequent weekly updates on LinkedIn and Instagram.
Leave a Reply