Toronto Real Estate Market Report
March 2008
Prepared by Chris Kapches
Senior Vice-President

The Toronto residential resale market for March was, to say the least, confusing if not downright perplexing. A superficial review of the statistics provided by the Toronto Real Estate Board would cause one to believe that the market is in serious
decline. In fact, as you wade through the pages of available statistics, it becomes apparent that the key market indicators, for the most part, all point to an extremely strong and boyant resale market. The key indicators are days on market, sale price as a ratio of list price, average sale price, and inventory.

The Board provides sales results based on four trading districts (which in turn are broken down into sub districts); namely, east, west, north and central. A review of days on market for each district indicates that the average days on market for
each district is improved as compared to March 2007. The east district was the only one in which days on market was the same as last year: 32 days. In central it only took 23 days for listed properties to sell. Last March it took 25 days. It must
be remembered that 2007 was a record-breaking year with 93,193 residential properties reported sold, and within that year most months were record-breaking months.

The data available related to sale price as a percentage of list price provides similar startling results. In the central districts 9 of the 14 districts produced average sale prices that were at or exceeded 100 percent of the list price, and the combined average of all the central sub-districts was 100 percent.

The average sale price rose in all districts from a high of 6 per cent in the north to surprisingly a low of 2.1 percent in central. This is no doubt due to the large number of lower priced condominium apartment sales that were record in the central districts in March.

High end sales declined from March of 2007. Sales of $1 Million plus properties dropped to 146 from 176 in 2007. Reduced sales in the higher end dragged the average sale price to only a 2.1 percent increase compared to the average sale price for all central districts in March 2007. Higher-end sales were affected by the volatile stock market, extreme and unfavourable weather conditions, and a mixture of school and religious holidays taking place throughout the month.

Inventory levels continue to be a concern. Overall the available listings at the end of March were down 6 per cent from March 2007, for a total of 20, 533 properties (21, 919 in March 2007). In some districts the decline of available properties was even more pronounced. In the central districts available listings were down by almost 8 per cent, from 2,829 in 2007 to 2, 618 this March. Even more dramatic is the decline from 2006. At the end of March 2006 there were 3, 249 available resale properties. Today’s available inventory represents a decline of 20 per cent compared to the properties that were on the market at the end of March 2006.

As we move into April it is too early to determine if there has been a market change, as the Toronto dailies are already claiming. The key indicators are pointing in the other direction and that the decline in sales, 22 per cent compared to March 2007, is due to a lack of inventory and various non-real estate related factors: the weather, holidays, and tangentially, the fluctuating equity markets. Days-on-market, sales-to-list prices, and increasing average sales prices are reflective of a strong market. It is crucial to the Toronto resale market that inventory levels increase. If that happens in April, we will know by the end of the month if the market has shifted. Until then, and perhaps even later, it is still a seller’s market place.