Cheryl Thompson

Market Report Mid-April 2020

On April 22nd, the Toronto Regional Real Estate Board President, Michael Collins is reporting results for the first 17 days of April 2020, in order to provide some guidance on the impact of COVID-19 on the Greater Toronto Area housing market. The report is as follows:

“All of the COVID-19 related issues and measures have translated into a temporary drop in the number of transactions – a drop that will persist until we experience a meaningful and sustained decline in the number of cases. However, once recovery begins, it will likely accelerate in earnest as buyers seek to satisfy pent-up demand that will build up over the course of the spring and at least part of the summer,” continued Mr. Collins.

“While the necessary social distancing efforts have certainly resulted in a substantial pause to housing transactions, it is possible that REALTORS® and their clients will be able to mitigate the impact somewhat using technology. TRREB and its partner board and association Members can now take advantage of virtual open houses accessed through listing searches on TRREB.ca and REALTOR.ca. TRREB’s professional development staff are also holding virtual webinars on other ways REALTORS can leverage technology to help their clients in these challenging times,” said John DiMichele, TREB’s CEO.

Looking forward, the decline in home sales will be likely strongest in Q2 2020, as strong social distancing measures remain in place for most of the spring. However, if public health forecasts assuming strong social distancing measures play out as expected, we will likely start to see improvement in market activity in the summer. Recovery will accelerate through the fall, as social distancing measures are substantially relaxed, many people return to work from furlough and home buyers take advantage of very low borrowing costs that will remain in place to spur economic recovery.

The calendar year average price for 2020 will likely remain near the 2019 level and will be buoyed by the 15 per cent year-over-year growth experienced in Q1 2020 and resumed growth in Q4. Year-over-year declines in home prices could be reported during some months in the second and third quarters, but these declines will have less of an effect on the overall price for 2020 because the annual share of sales will also be much lower than normal.

“As we recover from this temporary downturn, potentially later this year, home buyers will move off the sidelines in increasing numbers as they satisfy pent-up demand for ownership housing. Increasingly, these buyers will be faced with the persistent lack of listings inventory that was a serious problem before the onset of COVID-19. As the different levels of government look toward recovery, it will be important for them to resume and build upon initiatives to bring a greater diversity of housing supply online,” said Jason Mercer, TREB’s Chief Market Analyst.

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