On this rainy Friday I thought I would take a brief foray into the exciting world of statistics.
Wait! Come back and keep reading!
I promise I’ll make it interesting for you or your money back. (If you are one of the rare people who aren’t in fact paying top dollar for these priceless gems of mine, then I will happily refund you the $0 you are currently paying. In fact, I’ll double that refund!)
In this quick post I’m going to show you what’s happening in the real estate market on average.
Then I’m going to show you how, in most cases, the average is completely irrelevant to your situation.
Let’s get to it.
On average, in the Toronto Real Estate Board market as a whole:
- The number of active listings were down about 10% now, compared to the same time last year.
- The average sale price was up about 11% now, compared to the same time last year.
- The average days a property stayed on the market was down about 14% now, compared to the same time last year.
There you have it. Fewer listings, higher sale prices, less time on the market.
If you relied on the averages, you’d never buy a house. After all, you can’t find many houses that are for sale and when you do, they sell for crazy prices in a matter of days.
The flip side is that if you relied on averages and you own a house, you’d be crazy to not sell it now. Not much competition, you get lots of money and it doesn’t long.
So there we go. No one is going to buy and everyone is going to sell.
Wait, that makes no sense.
The reason it doesn’t make any sense is because the average is taken from what is going on throughout the market. In different geographic areas, with different types of houses, at vastly different price points.
I promised I would show you how the average is likely completely irrelevant to your situation. I’ll do that by showing you three quick examples of cases where the specific numbers are very different than the average numbers.
Number of Active Listings
The number of active listings is down about 10% now, compared to the same time last year.
On average, this means that inventory is down, which is a fancy way of saying there are fewer homes currently on the market.
Specifically, if you were looking to buy a condo apartment in York region recently, you would have seen about 3% higher number of units for sale now, compared to how many were for sale last year at this time. If you are buying a condo in York region, you’ve actually got more choice of options, not less.
Average Sale Price
The average sale price is up about 11% now, compared to the same time last year.
On average, this means that if you didn’t buy last year, you are going to pay significantly (11%) more now to get a place. People commonly say this is because of the crazy sale prices in Toronto and that outside of it, the average sale prices are not going up like that.
Specifically, if you were looking for a semi-detached home in the municipality of Clarington in Durham region, you’d be looking at an average sale price now that is 44% higher than what a semi-detached home there cost at the same time last year. That’s right, the market for semi-detached homes in Clarington is hotter than detached homes in the Leslieville neighbourhood of Toronto.
Days on Market
The average days a property stayed on the market is now 18 days, down about 14% compared to the same time last year.
On average, this means that the market is hotter now and that homes of all types sell quicker.
Specifically, if you are looking to sell a condo townhouse in the Mount Pleasant or Davisville area of Toronto, the average days on market there is 40 days. As of this time last year, it was 8 days, which is a 400% increase in length of time it takes to sell.
* All statistics calculated from TorontoMLS Historic Residential Data as provided by the Toronto Real Estate Board.
So there you have it. The average and the specific.
Whenever we look at what is going on for a specific area, housing type or price point, we use a far smaller subset of numbers. This gives us a much more precise idea of what is happening there.
While averages are useful to get an overall snapshot of what is happening, they can also be very misleading and far off from what is going on with your home or home search.
If you are curious as to what is going in the real estate market as related to your specific situation, don’t hesitate to get in touch. I would love to be responsible for what comes next.