There have been a lot of stories in the media about how we have record levels of inventory in Toronto’s real estate market these days.

As of today, there are just over 10,000 properties for sale in Toronto.

A year ago, as of the end of July, 2023, we had about 5,800 homes on the market in the city. That means that now we have almost double the level of inventory of properties for sale that we did at this time last year.

Despite that significant increase in the supply of homes, you may have noticed that politicians are not shaking each other’s hands and congratulating themselves on a job well done. It seems unlikely that we suddenly have shy politicians who don’t like to take credit for effective management of the housing crisis.

In order to see why the higher levels of inventory don’t mean we’ve solved our affordability issues in Toronto or the GTA, we need to look a little deeper into the market. When we do so, we see that more overall doesn’t translate into more of what we need.

First, the big picture.

As we write this at the start of August, 2024, we’ve got over 10,000 properties listed for sale in Toronto. That’s a lot more than we have had historically and the number of active listings in the city has gone up every month so far this year.

Let’s look at what type of properties are actually on the market to get a better understanding and as we do, let’s identify some important insights about what the data tells us.

Want a condo? We’ve got lots.

When we break down the inventory on the market, it looks like this.

• 2,962 freehold properties for sale in Toronto
• 7,089 condo properties for sale in Toronto

That works out to about a 30/70 split between freehold homes such as detached, semi-detached and townhomes and condo properties such as condo apartments and condo townhouses.

Here’s our first insight into the market as it stands right now. Yes, we’ve got higher overall levels of homes for sale, but 7 out of 10 of places on the market are condo properties. Good news if you want to buy a condo, but less thrilling if you’re looking for a freehold property.

Let’s keep going deeper to see what we find.

We have over 7,000 condo properties for sale in the city, but if you were thinking that means lots of condo townhouses, you’d be disappointed.

Almost 6,200 of the condo properties are condo apartment units, and close to half of those condo units (about 3,000 of the listings) are one bedroom units. Another 200 hundred are studio apartments with no separate bedroom, so more than half of the units for sale are pretty small.

If you’re looking for a larger unit with more bedrooms, we have about 2,500 two bedroom condo units for sale right now. If you did some quick math and said that doesn’t leave much of the available inventory to be comprised of three bedroom units, you’re spot on. Less than 500 of the 7,000 condo units for sale are three bedroom units.

Oh, and if you’re looking for a condo unit with six bedrooms, you’re down to just one option at 1 Bloor West, which is currently for sale at just under $35 million. We’d say at that price you should buy two, but there’s just the one in the city.

Here’s our next insight from looking deeper into the data. While there may be a lot of condo units for sale, the majority of them (over 50%) are one bedroom units or even studio apartments. This lack of options for families means that while condo apartment units are the most affordable option in the city, they don’t really work for most families. Add in the need for a parent (or two) to work from home and even the two bedroom units are rarely suitable for a family for long.

Let’s dig deeper into the freehold market to see what’s available there.

Almost all freehold homes for sale are detached, semis or townhouses.

We actually could have titled this section a bit differently and said that almost all freehold homes for sale in Toronto right now are detached houses. Full stop.

When we dive into the numbers, over 2,100 of the almost 3,000 freehold homes for sale now are detached homes. This is largely a function of the fact that detached homes make up the majority of freehold homes in the city of Toronto. Due to zoning constraints, up until recently many parts of the city were zoned single-family residential and many areas had only detached homes permitted.

When we look at semi-detached homes, just 418 are for sale in the freehold market right now. Again, this is a reflection of our housing stock. While some neighbourhoods have lots of semi-detached homes, many parts of the city do not.

The only other sizeable portion of the freehold market for sale right now are townhomes, but we say sizeable with a bit of tongue in cheek, as less than 250 of the freehold properties for sale right now are townhomes. Given that townhomes are typically the most affordable type of freehold home one can buy, this means that less than 10% of the housing stock available in the freehold market is “affordable”. We put that in quotes as the freehold townhome market ranges considerably in price, going from around $750K to almost $7M.

The insight from the review of the freehold market right now is that detached homes are actually the most likely home for someone to buy. 70% of the freehold market is detached houses, compared to semi-detached houses, which make up 14% of the market. Townhouses comprise just 8% of the market for sale right now. The remainder of the freehold market are a mix of duplexes, multiplexes, vacant land and other less common types of housing.

Let’s finish up our review of the freehold market by taking a look at what lower budget buyers have for options.

So, you want a freehold home for less than $1M?

It’s great that we have almost three thousand freehold homes for sale but the question is whether there are many that are actually listed below the $1M mark. This is an important threshold for many buyers as over that point, CMHC insurance is not available and through most major lenders that means you need to have at least 20% down for the purchase.

The review of the homes available in the freehold market for under $1M reveals some surprising aspects, as well as some of what we expected to see.

First off, lots of the freehold homes for sale in the city are in fact listed at over $1M. This isn’t surprising given a freehold home of your own in the city remains highly prized. There are a total of 486 freehold homes for sale for below $1M, which means about 1/6th of the freehold market is under that threshold.

When we break down what homes are available under $1M, there are some surprising results. It might seem logical that we’d see more townhomes, some semi-detached properties and very few detached houses in the sub-$1M price range.

In fact, just 71 of the 250 townhomes that are on the market are listed below $1M, so if you are looking for more options for a sub-$1M freehold home, you need to move up the property ladder.

If you’ve got a budget of $1M, you have about twice as many semi-detached options as you do townhouses, with 138 semis on the market.

The big surprise comes when we looked at the number of detached houses below $1M, where we get to double the number available again! That’s right, the holy grail of Toronto real estate, a detached freehold house, is twice as available in the below $1M market as semi-detached houses, which are twice as prevalent as townhomes.

The big insight that we pulled out of this review of the lower priced part of the freehold market is that the “best” type of home, a detached house, is actually the one type that you have the most amount of choice in for under $1M in Toronto.

Put another way, if you’re looking for a freehold home under $1M, you’ve got townhomes making up 15% of your choices, semi-detached making up 30% of your choices and detached houses making up 55% of your choices. While that may make sense due to the numbers of each type of homes across the city, it is still something that we only see when we look deeper into the numbers.

The Toronto real estate market is one of the most competitive in the world and if you’re thinking about buying, selling – or both – than you need to work with agents who understand what’s going on in a very detailed sense. If that sounds appealing, get in touch with us to talk about next steps!

Back in September, 2021, we wrote an article about how wrong the stats are for how long it takes real estate to sell. Our review then found that the number of days on market could be off by as much as 38%!

The reason for why these stats are wrong isn’t due to agents making mistakes or misrepresenting the data, but because of a quirk as how to the system works. Basically, the MLS system that we use to list real estate in Ontario allows real estate agents to terminate a listing that hasn’t sold and re-list it immediately. Whenever that takes place, the old MLS number is replaced with a new MLS number and the number of days on market starts fresh.

As a result, it means that the stats that are typically report in the media and that most agents use are based on the listing’s days on market, not the property’s days on market. If there was just the one listing for a place before it sold, then the length of time it took to sell is accurate, but if a seller had trouble getting sold and it was terminated and relisted a number of times, the days on market would be understated.

During the early days of COVID, the Toronto Regional Real Estate Board came up with a way to acknowledge the inaccuracy of this days on market (DOM) stat. Each month they release a report on how the average listing days on market differs from the average property days on market.

Property days on market, or PDOM, is what we see when we combine all of the recent listings for a property into one stat. We’re now starting to see market data that includes December and that means we can do a full year in review to see what happened in 2023, including with the actual (PDOM) days on market.

How long did it take in 2023 for properties to sell by area?

Let’s start with the data! The below chart has all of the TRREB municipalities and for each town or city, we see the average LDOM (listing days on market, which is the number most media stories report), followed by the actual average PDOM (property days on market, which is more accurate and reflects terminated and relisted properties), followed by the percentage difference between the two (how understated the LDOM actually is) and the difference in days between the two.

Let’s review what we found interesting in that data.

It actually took 47% longer to sell than most sources reported!

The above data shows each geographic area, but we also looked at the big picture.  When we take a look at all of the Toronto Regional Real Estate Board’s geographic areas covered (basically the GTA), the average days on market based on listings is shown at 19 days in 2023. However, when we look at the property days on market, which includes all those listings that actually were terminated and relisted (in some cases multiple times), the average days on market jumps up to 28 days. That’s nine days longer than most news stories would have reported, which works out to a whopping 47% longer!

Clearly we saw lots of properties be listed multiple times this year and if you only looked at the listing days on market, you would have been massively understating how long it took real estate to sell across the GTA.

Where in the GTA was the days on market most wrong?

If we look at the statistics for 2023 on a geographic basis, it was Halton Hills in the Halton area that saw the biggest difference between days on market versus property days on market. In 2023 Halton Hills saw an average days on market of 19 days, but that was understated by 11 days, as the property days on market was actually 30 days on market. That works out to the actual days on market for real estate there taking 58% longer than news stories would have you believe!

While Halton Hills had the biggest understating on a percentage basis, it was King, in York region, that had the biggest difference in terms of days. King showed it took real estate 29 days on average to sell in 2023, but when we look at the property days on market, that is a whopping 15 days understated, as it actually took 44 days on average.

Congratulations to Ajax for winning the most honest award for market stats!

If we look at where the reported days on market was closest to the actual days on market (PDOM), then Ajax in Durham region is the big winner. The average days on market in Ajax was 12 days according to listings and that’s just six days less than the 18 days we saw for the average property days on market.

It’s worth noting that how understated the actual (PDOM) days on market over the course of the year ranged from 26% to 58%, or from 6 days to 15 days. Put another way, even the most accurate data used in most media reports was off by about a week and if you added a couple weeks to any stat you read, you would have likely been pretty close.

When we look at the regions, Durham region was definitely the hottest and therefore most accurate region when it came to days on market. Basically, anywhere that properties sold in their first listing on market had the smallest gap between the two stats, and Durham region was the best in that regard.

There you have it – the actual, accurate data for where it takes the longest to sell as well as which markets were most misrepresented in news stories.

Terminating a listing and relisting it can be useful in a number of ways, including drawing fresh eyes onto a “new” listing, or avoiding having an improved (i.e. lowered) price go unnoticed because the listing itself is stale. While it can often make sense to terminate and relist, the typical use of listing days on market instead of the more accurate property days on market means that any stories that talk about how long it takes for real estate to sell should be viewed with significant distrust.

We’d very much prefer if TRREB and other real estate boards around the province stopped using listing days on market at all and switched completely to property days on market, but so far no one is following our advice!

If you’re looking to buy or sell real estate, make sure you work with agents who know when you can – and when you can’t – rely on the stats and give you useful advice. Get in touch with us to discuss your real estate needs!

In a hot real estate market like we’ve been experiencing in the GTA for the last while, it can seem like who you hire to sell a property has little impact on the sale.

If that was true, then it makes tremendous sense to simply hire the real estate company that charges the lowest commission.  Cutting your costs while maintaining the same result is always a good idea.

While every real estate agent and company will offer up arguments as to why they are worth their commission, there are stats that show how much over asking each real estate company gets for their clients.  This is actual data that specifies the average sale to list price ratio achieved by agents with these real estate companies.

Put simply, it answers the question – does it matter which agent I hire to sell my home?  The answer is a definitive yes.  We’re not permitted to disclose the names and statistics of the other real estate companies in the dataset, but we can tell you about our real estate company, Keller Williams.

Let’s review the data.

The Players

Within the GTA, there are seven major real estate companies that do significant volume of business.  How significant?  Each of the below companies transacted over $8 billion dollars worth of real estate in the GTA in the past twelve months (January 2021 to January 2022).  Here they are, in alphabetical order:

• Century 21
• Homelife
• Keller Williams
• Re/Max
• Right At Home
• Royal LePage
• Sutton Group

It is worth noting that there are hundreds of smaller real estate companies that collectively transact significant volumes within the GTA.  While as a group those small, individual brokerages do lots of business, it is the seven companies listed above that are the largest within the GTA and they account for about half of all of the real estate transactions that take place in the GTA.

110.07% Over Asking

When we look at the average sale to list price ratio in the GTA over the past twelve months (January 2021 to January 2022), here’s what we see.

Within the seven major real estate companies in the GTA, the average sold to list price ratio is very good news for sellers.  Six of the seven companies have a range that is between 107.5% and 108.7%, meaning these companies make their clients between 7.5% to 8.7% more than the list price on average.

The outlier in this group of seven is Keller Williams, which comes in at 110.07% on average.  That’s 1.31% more than the next highest result and a whopping 2.55% higher than the lowest average return amongst these companies.

Put simply, if you hire an agent from Keller Williams, on average you’d make at least 1.3% more than any other agent, and you could make up to 2.5% more than if you’d hired an agent from another company.

Make Between $14K to $28K More

If we use the average sale price in the GTA over the past twelve months of $1.127M, that means that Keller Williams agents, on average, make their clients almost $15K more than the second best performing company and over $28,000 than the lowest performing major real estate company in the GTA.

That may not feel like much when you look at the sale prices we’re seeing these days, but look at it this way – hire an agent from KW and whatever high price you sell your home for, add between $15,000 to $28,000 extra.  When it comes to selling real estate, more money is almost always better.

Hire a KW Agent and Sale Commission is Effectively Zero

That 2.55% difference in average sale to list price ratio from the lowest ranking real estate company to Keller Williams is a definitive answer as to whether your listing agent makes a difference to your sale price.

It matters who you hire.  It just does.

With a typical listing commission of 2.5% on the sale side – and KW agents selling for between 1.31% to 2.55% higher than all of the other agents of major companies in the GTA – if you hire an agent from Keller Williams it could effectively cost you nothing to pay them their commission.

The next time you see ads for discounted commissions for a listing agent, think about whether they would be willing to discount their commission to nothing, or even pay you for the privilege of selling your home.  They would say no, but if you hire a KW agent, the increased sale price means they are literally earning you the money to pay most or all of the commission to sell your home.

Not just better, quicker.

As a final added bonus, when we look at the average days on market it takes for a home to sell, Keller Williams also leads the pack, taking 11.1 days on average to sell a home in the GTA.  The next quickest result is 12 days and the slowest is 13.6 days.

Just like with the sale to list price ratio, Keller Williams is a significant outlier and the only real estate company to sell for less than 12 days.  A speedy sale at a higher price?  That sounds like a pretty good result.

It can be hard to tell whether there are genuine differences between real estate agents and whether one real estate company is a better hire than another.  These stats prove that when it comes to selling a home, if you want to sell for significantly more than you would get with another agent, and quicker to boot, you should hire an agent from Keller Williams.

We’re proud to be part of the number one real estate company in the world, with the largest number of agents doing the highest volume of deals, and if you want to see your home sell for the most money, in the quickest amount of time, get in touch!

In many aspects of life, more money means more choices.

In real estate, more money typically means better choices – but not necessarily more choices.

Whether is is builders focusing on a specific budget for the new properties they develop or the resale market responding to demand for certain types of properties at certain price points, real estate markets develop their own dynamics for supply.

We did an analysis of the levels of supply for different types of homes across the GTA, looking at number of available properties across 20 price bands, ranging from $500,000 to $3,000,000.  We did for the four main types of real estate, namely:

• Detached Houses
• Semi-Detached Houses
• Townhomes
• Condo Apartments

We did this using market data for available properties as of Friday, October 22, 2021.  Even if you’re reading this on that same day, the data that we used has already started to change.  Properties are selling and new properties are being added, and as that happens, the statistics change.

Despite the fact that the data changes quickly, this sort of analysis is very helpful in understanding what properties are available – and at what price point.  We’ve presented the data in chart form below and we’ve highlighted the most interesting and surprising results from this review.

Let’s get into it with the big picture review for all housing types.

How many options are for sale in each price band?

The chart below shows us exactly how many properties are available in the GTA on October 22, 2021, across twenty price bands.  From $500K to $3M, we’ve tracked down how many properties are for sale in each $100K price band.  Here’s the results.

Here’s a few surprising results from the above chart:

• Across the GTA you can see that your most options are available under the $1M mark.  That may be surprising given the media focus on how high the average sale price and it shows us that using the average can be quite misleading.  Yes, there are lots of properties that are for sale that over $1M and even a decent amount for sale in the $2M to $3M range, but your the most choices available all fall within the five lowest price bands.
• The lowest number of choices in the GTA are for people looking to buy in the $2M to $2.1M price point.  There are just 51 choices as of today.
• There’s a big jump in the number of properties available at the $2.9M price point.  If you’re looking in the $2.5 to $2.8M range you have in the 50 to 80 range of options but at $2.9M you have 119 options as of today.

How many detached houses are for sale in each price band?

Now let’s look at the number of detached houses that are available across the GTA today in each $100K price band from $500K up to $3M.

There are some very surprising results from the above chart, namely:

• The most amount of detached homes (205) are available if your budget is $1.4M to $1.5M.
• We see spikes in the number of available detached houses right before we cross over to the next million range.  There is an additional 60 homes available at $900K compared to $800K, an additional 26 at $1.9M compared to $1.8M and a whopping 59 more at $2.9M compared to $2.8M.
• Yes, it’s hard to buy a detached home in the GTA for $500K (only 27 are for sale in that price band) but we see other price bands ($2M, $2.7M, $2.8M) where there are under 50 available.

How many semi-detached houses are for sale in each price band?

While semi-detached homes remain relatively rare across the GTA, we do have a number of options available for sale.

The above chart looks a lot different than detached homes and here are some surprising aspects:

• If you’ve got a budget of $800K to $1M and you’re looking for a semi-detached, you’ve got tons of choices, with the top two highest amounts available in these price bands.
• Once you hit the $1.9M range, semi-detached houses are quite rare, with under 10 available in all of the subsequent price bands.
• It’s easier to buy a semi-detached house if your budget is $2.3M than if it is $2.2M or $2.4M.  You’ve got one option in each of those price bands and five in the $2.3M price band.

How many townhouses are for sale in each price band?

While freehold townhouses are often referenced as the “bottom” of the freehold property ladder, there are more and more luxury versions of townhomes available that rival semis or even detached in terms of costs.

When we look at the above chart, we see some surprising results:

• The peak in terms of available townhomes is the same price band as the peak of available semi-detached houses, namely $800K to $900K.
• The price bands from $1M to $1.4M are quite similar in terms of availability, with between 23 to 27 townhomes in each.
• While there are no price bands with 10 or more options over the $1.6M, we still have 46 townhouses for sale across those pricey ranges.

How many condo apartments are for sale in each price band?

From freehold properties, we turn to condo apartments.

Just like with our earlier charts, the data around condo apartments for sale right now has some real surprises:

• More than 80% of available condo apartments in the GTA are below $1M.  If you’re looking for a condo apartment above the $1M mark, your number of options drops dramatically.
• There are spikes in number of available condo apartments at $1.1M and $1.7M, meaning that if you’re selling in those price bands, you’ve got more competition than units listed for $100K lower.
• While the $2.7M to $2.9M price bands have the lowest number of options (only 4 in each), if you’re looking for a condo at just over $2M, you’ve only got six options as of today.

While the above charts and data are from a specific moment in time (October 22, 2021) and the results will change over time, there are definitely some surprising points amongst the data.

The big takeaway is that regardless of your specific list of desired features and attributes, increasing your budget doesn’t necessarily give you more choices.  There are specific price bands for specific types of housing where you will have more or less options when you go up or down a bit on the price range.

If you’re considering buying a home, it makes sense to work with agents who know how to analyze market data to tell you when and where the most choices can be found.  If you want to talk about your search, get in touch.

The MLS system that we use to list real estate in Ontario allows real estate agents to terminate a listing that hasn’t sold and re-list it immediately.  Whenever that takes place, the old MLS number is replaced with a new MLS number and the days on market starts fresh.

As you can imagine, this means that the DOM stats are very unreliable as it is not unusual at all to see multiple attempts at selling a home on any given street, neighbourhood or building.

The Toronto Region Real Estate Board recently came up with a way to acknowledge the inaccuracy of the DOM stat.  We now have the ability to see not just the average listing days on market, but also the average property days on market.

Property days on market, or PDOM, is what we see when we combine all of the recent listings for a property into one stat.  When we look at that, we see that across the GTA, the listing days on market is 13 days and the property days on market is 18 days.  This means that homes actually take 38% longer to sell than what is commonly communicated in stats and media stories.

Let’s look into specific areas around the GTA to see what the real story is with days on market.

Across the GTA, it takes roughly 20% to 40% longer to sell than is commonly reported

If we start by looking at regions within the GTA, we see that Toronto leads the pack in terms of the most understated days on market.  When we account for listings that were terminated and relisted (which gives us the PDOM stat), we see that rather than the 16 days that is commonly reported, the actual days on market is 22 days.  That means that it takes 38% longer to sell than what most media stories report.

In terms of other areas, Peel is close behind at 36% and York is at 33%.  The rest of the GTA comes in at under 30%.  Dufferin County (effectively Orangeville) is the least overstated region at 22%.

Let’s look at specific municipalities now.

Toronto Central is the most understated, followed by…Caledon?

When we look at the 33 markets within the GTA, we see some surprising results.

Toronto Central is the most understated market in the GTA, reporting a listing days on market of 18 days, but an actual, property days on market of 26 days.  That means it actually takes 44% longer to sell in central Toronto than you would think based on the market stats that are commonly used.

Caledon comes in at a surprising second place, with homes taking 42% longer than what is commonly stated.  Instead of 12 days on average, the actual length of time it takes a property to sell in Caledon is 17 days.

At the bottom end of the scale we see a number of parts of Simcoe County.  Adjala-Tosorontio takes the prize for the least understated area in the GTA, coming in at just 6% higher, or just one day different.

It is surprising to see Burlington near the bottom of the list as well, meaning that you don’t see a lot of sellers in Burlington fail to sell and then relist.  The listing days on market is 12 and the property days on market is 14, so it only takes about 17% longer to sell than is commonly reported.

Deciphering real estate stats can be challenging and you need an expert to make sure you’re making decisions based on accurate information.  If you’re thinking about buying or selling real estate, let’s talk.