The COVID-19 pandemic and subsequent lockdown has deeply affected almost every area of our lives. And the real estate market here in Toronto is no different. Not surprisingly, with so many businesses closed down, and so many citizens either having lost – or fearing that they will lose – their jobs, investing in a new home isn’t a top priority for very many people right now.
At the beginning of the pandemic in February and early March, the Toronto market was seemingly unaffected. The housing market was seeing the growth that you would typically expect as spring homebuying started to heat up.
According to data from the Toronto Regional Real Estate Board (TRREB), home sales in March reached 8012, which is a 12.3% increase from March of last year. Average home prices were up as well - $902,680 in March of 2020 which is up 14.5% compared to last year.[i]
But when the Province was put under lockdown in mid to late March, that changed abruptly. In April of this year, realtors reported only 2975 residential transactions through the TRREB MLS System. That’s a 67% drop from April of last year.[ii]
Of course, the Toronto real estate market is never going to come to a complete halt. There will always be people who will need to buy or sell a home – even under the current circumstances. And as long as someone has a down payment and job security, they will still be able to enter the market.
What does COVID-19 mean for those who are looking to invest in Toronto real estate?
The circumstances surrounding the novel coronavirus pandemic may actually benefit Toronto homebuyers. Over the last several years, the influx in new immigrants to Canada has had a major influence in driving up Toronto home prices.
With the borders temporarily closed, and financial uncertainty keeping many others out of the market, buyers may find that they encounter fewer bidding wars, making it easier for them to get into a Toronto home.
Buyers will also be able to take advantage of lower interest rates. In an effort to mitigate some of the financial damage caused by the pandemic, the Bank of Canada lowered its benchmark rate from 1.25% to 0.25% - the lowest it has ever been. These lower interest rates will help to make mortgages more affordable for those entering the market.
What does COVID-19 mean for those who are looking to sell?
As evidenced by fewer homes being put on the market, the coronavirus pandemic seems to have made many would-be sellers a little nervous. Those who are willing to take the plunge, however, will likely find that selling during this time is not as difficult as they think.
Those looking to purchase homes have adapted well to changing technologies and have become quite comfortable with virtual open houses and contactless transactions. The key of course, is to work with a real estate agent that is competent in these technologies.
How Adelson and Weiss can help.
Whether you are thinking about buying or selling, there is no denying the fact that we are living in a new world and we must find new ways of doing things. When the pandemic is over, the Toronto real estate market will rebound but we may never fully go back to the old ways of business.
That’s why it is so important to work with a real estate firm that is adaptable and able to pivot. At Adelson and Weiss, we have incorporated new technologies to help ensure our clients are still able to buy and sell – during this pandemic and after.
Contact us today for more information.