So, what? Nobody wanted to talk about the rental market on Monday and Tuesday?
I’m not hurt, don’t worry. I lay it out, for y’all ta play it out.
I’ll write, and you can respond, or not. You can hijack the comments section for a blog about bungalows to talk about peanut-butter. It’s your forum, after all. This was always the intention.
But yes, I realize after the fact that people want to talk about COVID-19 and how it’s affecting the real estate market, although in my defence, I wrote Monday’s blog on Sunday night, and the world is changing every twelve hours.
I think back to one week ago, and none of this was upon us.
Buyers were freaking out about how many offers were going to be on the house they wanted to buy.
Now buyers are freaking out about how much to offer the guy in the parking lot at Costco selling toilet paper.
The first time I had heard of “Coronavirus” was probably back in January when we all read about this mysterious flu that was breaking out in China, causing even more people to wear masks than usual. A friend of mine was in China at the time, and we thought he was insane for going. Then he came back, and we told him not to come into the office.
Did we ever think that we’d be in the position we’re in today?
Perhaps that’s part of the problem – that we didn’t merely assume we’d be in this position.
A member of my team sold a condo in early-January and the deal fell through on a review of the Status Certificate, but we were having trouble getting the seller to sign the mutual release. The seller, of course, was in China, and we figured that would be tricky as is. But with this virus going around? We had no idea what was about to happen.
The original mutual release that we sent over was for twenty-four hours; lining up with the remaining day left on the 3-day review period written into the condition. But when that mutual release expired, we sent over another one, this time with forty-eight hours.
One week later, we still hadn’t heard from the seller.
I spoke to the agent every day, and he kept saying, “I haven’t heard from the seller. Not a word. No email responses. Nothing.”
I didn’t believe this, of course. Who in the world doesn’t have access to email?
Three days later, going on two weeks since our deal had fallen through, the listing agent updated me.
“The seller is elderly and cannot use DocuSign; he needs his printer,” the agent told me. “But he can’t get to his printer at work because all the offices are closed, and even if they weren’t, there’s no taxi service and cars are halted. People are not supposed to leave their homes.”
And what did I think?
Well, I questioned whether or not this was all true.
The irony about the “information superhighway” that we created for ourselves years ago, and the fact that the planet has become a small globe, is that misinformation spreads as fast, or faster, than factual information.
Look no further than the videos of Chinese people eating BAT-SOUP that magically appeared last month as the obvious, bona-fide, no-questions-asked cause of the Coronavirus. Did any of you gleeful Youtube-watchers ever stop to think that maybe, just maybe, this isn’t how the disease started?
If you were a child of the 1980’s like I was, you’ll recall kids on the playground stating, “AIDS started because some guy in Africa fucked a monkey,” and we just believed it. I know I did. But I was eight-years-old.
In 2020, it’s almost impossible to distinguish between news and propaganda, and certain media outlets seamlessly blend them together to be slurped up by a hungry and dedicated viewership.
So when I heard that China was on lock-down because of a virus caused by bat-soup, and that perhaps millions of people had died but the government wasn’t reporting it, well, I had no idea what to think.
We got our mutual release on that property, in the end. The paperwork was signed electronically by DocuSign, so of course, I felt like the lockdown, no-cars, offices-closed story was complete garbage.
Now?
I feel silly. Like the rest of the world.
The fact that the TRB readers wanted to talk about Coronavirus last week tells me that people are truly concerned. Fearful and panicked? Not all of us. Not even a majority, I would think. How many happy joggers and dog-walkers are outside right now, enjoying the unplanned vacation? Is this naivety? Indifference? Did the rest of the world overreact?
A friend of mine works in a lab, and he told me last weekend “This is a powder-keg about to explode.”
You’ve heard that before, right? A dozen times?
But you’ve also heard people say that only 89-year-olds with emphysema are at risk? And for the rest of us, the virus might be like one or two days of a runny-nose before we’re back to running 10 K’s and eating kale salads?
Who freakin’ knows.
We’re all dealing with this in our own way.
One of my favourite comedians of all-time, as many of the long-time readers know, is David Cross.
In the early-2000’s, David Cross did a comedy routine about 9/11. Risque, yes, but this was in a better time when comedy was allowed to touch all subjects, and when the people who were perpetually-offended would just avoid, you know – buying tickets to things they found offensive, rather than trying to ensure the rest of the world was forced to take on their values and beliefs.
Anyways…
David Cross did this bit about how the best thing he saw during the days after 9/11 was a guy decked out in spandex, “rollerblading…..with purpose!”
His bit went something like, “Nobody’s gonna tell Gabriel where to rollerblade. Gabriel’s gonna do what Gabriel’s gonna do. And if Gabriel doesn’t rollerblade to the Chelsea Pier, then the terrorists win.”
The point to his bit was that everybody dealt with 9/11 differently, and some people, in Gabriel’s case, felt that they needed to try to act normal in order to lessen the burden.
I’m not comparing Coronavirus to 9/11, but rather the similarities with how people choose to cope.
For every person reading a book on a park bench today, there’s another one huddled under a blanket watching Narcos: Mexico on Netflix.
Who is the first person to tell the second person that he or she is wrong, or vice versa?
How am I coping?
I’m choosing to work. At least, where I can.
The Toronto real estate market is not operating in the same fashion as it was one week ago, but it’s also not shut down like bars and restaurants.
As I alluded to on my blog on Monday, I was set to receive offers on a condo listing on Monday night.
The property was in Regent Park; a quaint 1-bed, 1-bath, measuring just under 500 square feet, with owned parking and locker.
We listed at $499,900, because that seemed like a nice number, and set offers for a week later.
I figured that I would get 10-12 offers on the property, and perhaps back in February, I’d have received 15.
I was hoping for over $605,000, since that’s the price at which we turned down a bully offer on the third day of the listing.
In the end, we didn’t get 10+ offers like I had predicted, and we also didn’t get $605,000.
We got 8 offers, and $624,000.
For those playing along at home, that’s over $1,270 per square foot, absolutely obliterating the previous record of $1,232/sqft.
So what does that tell us about the Toronto real estate market?
Well, it tells us that the market is still red-hot!
Alas, that was on Monday night.
And by Tuesday morning? Well, I think things had sort of changed.
All three of our “leaders” in government; municipal, provincial, and federal, had given press conferences by noon.
And shortly thereafter, I found myself forced with a decision: should we be listing properties for sale this week?
In the end, after consulting with my team, brokers in my office, and a host of colleagues throughout the industry, I concluded that we should not. Not this week.
So with a King West condo scheduled to come onto the market on Tuesday afternoon, I called my client and told them we needed to hold off.
This wasn’t an easy thing to do. A 700 square foot soft-loft in a boutique building in the heart of King West? That’s literally real estate gold. But with the risk/reward scenario staring me in the face, I figured, “What’s the upside here?”
Today was not a slow day for listings, by any stretch!
Check this out:
I always use “Downtown” as the litmus test in these conversations, and in peak season, you might see 100+ listings on a Tuesday or Wednesday. On a Tuesday in mid-March, I would probably expect to see 50-60. So with 57 properties listed today, we are literally right where we should be.
But the issue on my mind is how these properties will be listed, and how they will sell. At least for this week, with all the changes to our daily lives that we’ve seen.
Most of these listings for downtown condos still have “offer dates.”
But how about that listing at “Rezen” on Frederick Street that came out at $689,000 with offers any time? Is that how this would have been listed two weeks ago? And is that how this will be listed in the first week of April?
Not one of my buyers have changed their search criteria. Four of them emailed me listings today, and I have viewings scheduled for Thursday, Saturday, and Sunday.
But there’s just something about this week, on the listing side, that I can’t get behind.
For those that like to make bets on TRB, as well as predict the future, here’s one for you: I will bet that the average condo price in September/October will top the $722,675 that we saw in February. That means I believe this market will continue to ascend, that I don’t think there’s a downturn ahead, and that I do believe the Toronto real estate market will get over COVID-19.
But what’s going to happen tomorrow? Or on Friday?
I don’t know.
That’s why I told one of my clients to hold off this week, and with three listings scheduled to come out next week, we may list all four, and we may list one or two.
As I told a client on the phone tonight, I’m a “planner” by nature. I like order. I like preparation. I like knowing. But with what’s going on out there right now, flexibility, versatility, and adaptability are crucial, as is the ability to think objectively, and come up with a solid Plan-B. I told him that we may list his house next week, and we may not. As much as it pained me to say it on the phone, there’s just no way to know what we’re going to do tomorrow, today.
That’s where this crisis has left us.
And all the while, I could come off as insensitive crying about the real estate market when “people are dying.” Ask Vanessa Hudgens how she feels about that.
But life goes on, as does everything therein.
My life is centered pretty heavily around real estate, so that’s what I’m thinking about. It’s what I’ll be writing about too, even if it continues to be the same update on how the market is working, given the societal conditions out there. But I’m hoping that it also gives many of you an escape for a few moments each morning, as well as an outlet.
Here’s to better days ahead!
Appraiser
at 9:46 am
John Pasalis @JohnPasalis:
“I will say that I am puzzled by some housing bears who have been “calling the bubble” for ten years and are now showing restrained jubilation about a global pandemic – presumably because they believe house prices may fall so they can finally tell their friends “I called it”
https://twitter.com/JohnPasalis?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor
Chris
at 9:53 am
And the restrained jubilation people are showing about house prices declining is different from the jubilation you are showing about equity prices declining is different…how exactly?
Kyle
at 10:19 am
If this pandemic finally tanks Toronto real estate (which i think is unlikely), it might satisfy their Schadenfreude but it will not actually make any of them right.
It would be like some guy droning on and on year after year to a fit, healthy active woman, that she is going to die in the next few months from obesity, sedentary, diabetes, cancer, etc. If one day that woman gets hit by a car and passes away, it certainly didn’t mean that guy was right.
Chris
at 11:06 am
I think most of us who hold a bearish outlook on Toronto real estate do so because of the high valuation and prevailing vulnerabilities (e.g. record levels of household debt, speculative/investor activity, etc.).
Nobody could predict a pandemic coming. But many warned of the exacerbated impact a shock to our economy could cause.
Kyle
at 11:15 am
Guy at fit, healthy, active woman’s funeral, “See i told you she was unhealthy and on death’s bed, maybe if she were more fit, healthier, and more active she would have survived being run over by a car”
At what point do you guys finally give it up and realize that this market has survived all the theories you guys jump aboard and subsequently abandon when they fail? Maybe the market isn’t over-valued and vulnerable?
Chris
at 11:27 am
Working within the parameters of your analogy, us on the bearish side thought the woman wasn’t very healthy; you on the bullish side thought she was just fine and in good health. She kept on running, albeit stumbling a bit in 2017. Today, she’s facing a bigger threat, which may demonstrate just how healthy or unhealthy she truly is.
Will certainly be interesting to see how she copes with the almost certainly coming recession.
Chris
at 11:32 am
“Nothing puzzling about it. The bulls cheered on the way up, regardless of the societal dislocations it was causing. The bears do the same on the way down.” – Brian Chang, Crusoe Economics, in response to John Pasalis’ above tweet
Kyle
at 3:38 pm
Good grief given the already extreme bitterness harboured by the bears, i can’t even begin to imagine the degrees of bitterness and rage they will have if/when prices don’t actually go down.
Chris
at 3:44 pm
Once again, I feel the need to remind you that “bearish” or “bullish” are simply opinions on the valuation of an asset.
They are not tribes or sports teams. People can move between them pretty easily, depending on price, macroeconomics, political developments, etc.
It’s the same reason I don’t think Pasalis’ comment about “bears…calling the bubble for ten years” is very useful. Garth Turner being wrong in 2009 doesn’t automatically make Housing Bear wrong in 2019.
Kyle
at 4:04 pm
Tell that to the guy you quoted.
Chris
at 4:12 pm
He doesn’t seem bitter or enraged, but I don’t know him so can’t say for sure.
I thought real estate would keep going down in 2017, yet I was wrong and it stabilized with the condo sector continuing to appreciate, and I wasn’t bitter or enraged.
You thought the high-water mark for average price attained in 2017 would be surpassed in 2018, yet you were wrong, but you didn’t seem bitter or enraged.
I think most of us are able to discuss our opinions on this asset class’ valuation while not defending them with religious fervor.
Kyle
at 4:35 pm
See Sohan’s comment below.
Chris
at 4:37 pm
Hey, I did say most of us, not all of us! There will always be those unhinged exceptions.
Appraiser
at 9:56 am
Latest data from Teranet is out this morning:
“In February the Teranet–National Bank National Composite House Price IndexTM was up 0.4% from the previous month, a rise that was double the average of the last 10 Februarys.”
https://housepriceindex.ca/#maps=c11
Chris
at 10:05 am
“Unfortunately, then came the outbreak of Covid-19 and its impact on oil prices and disruptions in the supply chain. The unprecedented sanitary measures imposed by the authorities to tackle the pandemic will severely impact business activity and jobs over the coming months. In that situation, the home resale market should be heavily curtailed for the coming months.” – Marc Pinsonneault, Principal Economist, National Bank of Canada
Appraiser
at 1:37 pm
The number of transactions might be impacted, but prices are another story.
If anything drastic does occur, it could be that the number of showable listings becomes depleted, as owners become increasingly uncomfortable about allowing strangers through their homes. Vacant properties may be the only ones on the market soon.
A lower inventory of listings to show is not desirable in a market that has been chronically low in listings for many years.
Chris
at 2:08 pm
It’s really hard to say right now. I think everyone agrees that sales volumes will fall, probably dramatically. It seems almost a given with social distancing policies in full-effect.
The potential for price declines comes in tandem with the economic fall-out from the pandemic. As both Jimbo and Natrx have alluded to, there will invariably be some financial hardship from all this.
Certainly some owners will put off selling their homes, to wait for Covid-19 to pass, and hopeful that the market picks back up. But what of those who lose their employment and income, particularly if they own additional properties (beyond their principal residence), and are cash-flow negative?
And while we may see some supply removed, as people become reluctant to let strangers in their home, equally we should see demand removed, as people become reluctant to go into a strangers home. And, as Natrx mentioned, others may be hesitant to take on a large mortgage heading into times of financial uncertainty. We’re already seeing this with stories of people trying to back out of deals.
Anyways, at this point there’s a lot of uncertainty. Much depends on how long our economy is put on hold.
Jimbo
at 12:44 pm
I think you are playing it smart. Nobody knows what kind of financial impact keeping people home will have. There are going to be a lot of losers in this and $82 billion isn’t going to go deep enough to keep everyone floating.
I certainly don’t want to see anyone in financial ruins over this crisis but I don’t know how small business owners and the people they employ get through this in one piece.
My personal opinion is we shouldn’t be shutting everything down to flatten the curve as there is no guarantee we can come up with a cure before we damage the lining that holds society together. Just because we add resistance to a capacitors path doesn’t mean the capacitor doesn’t charge up…..
I believe it is better for people to self identify that they need to socially distance to keep a sick loved one safe. If we engaged legislation to identify the people that were “canned” due to not going into work we could find their wage until they found something else after this blows over in August.
Just my 2 cents
Chris
at 2:13 pm
As I said the other day, we’re sacrificing economic activity for public health. Personally, I think it’s the right decision. Imagine if it were you, or a family member, or a friend, who became critically ill because we as a society decided to prioritize our economy over containing and slowing this pandemic? It’s not an easy decision, but I think we’ve made the right one.
Jimbo
at 2:19 pm
I hope it is the right one. Every passing day will deteriorate our ability to afford a social safety net if things do get bad.
The velocity of money is what we run on and when you take away that Force, instability will happen. I’m not worried about having doctors around to diagnose and create positive outcomes, I’m more worried about our ability to get the supplies into the country that we need to fight the virus.
Chris
at 3:49 pm
I don’t know that we’ll ever be able to determine definitively if we made the right call. A year from now, maybe our economy has suffered but Covid-19 did not infect too many people; how will we know for certain that it wasn’t the economic sacrifices we made that protected our collective health?
I can only think that if a loved one were infected and died, and we as a society had disregarded medical advice in favour or maintaining economic activity… I would be pretty upset.
Drowzee
at 12:59 am
I don’t think it’s realistic to implement selective social distancing. It would still allow the virus to spread exponentially, and we’ll likely end up with lots of sick people who need intensive care, and with overloaded hospitals, like Italy right now. And then, we’d be forced to shut down even harder, which would damage the economy even more.
It’s very instructive to look at how Italy (and France and Spain) got to where they are today, and to learn from their experience. For example, there’s this great video where Italians record messages for their past selves, talking about how much their attitudes changed in just 10 days:
https://www.youtube.com/watch?v=o_cImRzKXOs
I think our best hope is to slow the spread of the virus enough for our public health agencies to catch up with it, like they’ve done in Singapore and Korea. And then, we can (mostly) get back to our usual lives.
Jimbo
at 10:00 am
The thing with exponential growth is you can’t stop it from being exponential, what you can change is the value of x in the exponent of e. This means the same number of people will eventually get it before some show natural immunity. Just the doubling time goes from 2 days to say 10 and yes this will give the hospitals time to triage more effectively.
We are also assuming that our doctors and the medical system can catch up, there is no guarantee they find a cure or vaccine.
For the record I am staying home and distancing myself to stop the spread as it is the smart thing to do.
The thing I love about South Korea is they tested everyone IOT get the asymptomatic people off the street and keeping the productive people working, that is how they limited x to less than 1. We on the other hand are wasting tests on people that we assume have the virus. They could use MRI on patient to check on lungs just as effectively to figure out if they have it and it would be much quicker. The tests should be offered in a drive through on the healthy so that presumptive healthy person doesn’t come into contact with 600 people when they are sick and spreading the disease because they aren’t showing symptoms yet.
Natrx
at 1:45 pm
I already know some people willing to take whatever bid they can knowing there will likely be a slow down in activity.
Anybody with a job right now will probably start to think a little longer about jumping in with bidding wars. While the tech sector is ‘hot’, there are real cracks to where many of them get their funding from. Probably won’t start seeing any real impact until the 2nd half of this month.
Chris
at 2:17 pm
Hearing more than a few anecdotes of AirBnB hosts who have gone from solid occupancy to near zero bookings for March through May. Not such a big deal if it’s a room in your house that you’re offering. Pretty big deal if you own 5 units and rely on that cash flow. They’re starting to rumble about offloading if this doesn’t resolve quickly.
On the other side, starting to see more realtors and mortgage brokers talk of buyers stepping back, or trying to get out of deals, because their continued employment is all of a sudden on shaky ground.
Appraiser
at 2:43 pm
Anecdotes are crap.
“I already know some people…”
Really ?
Chris
at 3:25 pm
… um… Did you forget that you were just sharing anecdotes from Pasalis the other day? Or is it exclusively anecdotes you don’t like that are crap?
We’ll have data soon enough. For now, anecdotes are what we’ve got.
Appraiser
at 6:42 pm
Um, ah, duh… anecdotes are at best second and third hand hearsay.
At worst a complete fabrication. You know fairy tales.
But it fills in the gaps for some.
I’m in the business remember. Boots on the ground and all that. I interact with more buyers and sellers in one day than you two clowns pretend to all year.
I see zero deals falling apart.
Zero.
Chris
at 6:52 pm
So to paraphrase:
“Anecdotes are total crap! But anyways, here is my own anecdote. Now let me throw in some crude filler because I’m unable to converse like an adult!”
Top notch as always, appraiser!
J G
at 9:46 pm
You’re a clown. It’s because you’re in the industry, no one trust what you say.
MortgageJake
at 2:01 pm
REALLY? You don’t see deals falling apart because your boots are responsible to do appraisals, and not to see if the buyer or seller ends up bailing.
I am *starting to see* cracks. COF clients not waiving financing because of uncertainty. Buyers holding off big time. Less calls, less emails, less everything.
Which is good. Stay home. Don’t bother buying a house in this market. You’d be stupid to.
If things fall apart- it’ll be available in 6 months for a discount.
If things do not fall apart, your FOMO will not kick in, you will not see prices go UP.
Stay home.
Refocus.
Recalibrate.
Keep saving.
Pragma
at 11:57 am
I saw two deals fall apart over the weekend.
Natrx
at 11:29 am
Hahahah, Appraiser is just jokes.
Funny person.
Appraiser
at 2:22 pm
Don’t overstate the case Jake. No one said the market isn’t shrinking. But prices are not thus far.
Long Time Realtor
at 8:45 pm
Hey Jake,
Conditional offers falling through are not unheard of. How many of your firm deals are falling apart. What data do you have? I’m not seeing any firm deals in our office falling through.
Cal
at 2:48 pm
As per today’s announcement, commercial banks will get billions to provide relief to their clients who cannot make mortgage payments. So what does that mean for new mortgages? Will banks become more careful and slow down on issuing new mortgages, or will they happily lend to anyone and expect that the government will assume any future risk?
Marina
at 2:49 pm
Well, we are in a recession, and depression is coming. But if we also go into hyper inflation, as some theorize, you are much better off spending your money now… so yeah. Hard to know.
Chris
at 3:46 pm
Seems a bit alarmist, no? Recession seems likely. Depression, less so.
Crofty
at 7:42 pm
Don’t forget the stagflation part.
Sohan
at 4:23 pm
I Promise, From This Day on, Which is Wed. Mar. 18th, 2020. Real Estate Agents will be Eating DUST. I Pray to GOD all that I have Said Comes TRUE. MAY GOD BLESS ME SO I SEE IT FOR MYSELF. THANK GOD!
CHT
at 7:19 pm
Not sure what this message even means. I’m quite sure though that if there is one, GOD got MORE important THINGS TO DO than listen to your degenerate wishes. Use your energy for something meaningful. IT SEEMS LIKE YOU NEED it. And fix your CAPSLOCK.
Sohan
at 8:13 pm
You have more cap locks than I do
Phillip Huggan
at 4:33 pm
I have a longer term stimulus idea regarding condos and new building construction in general. For airborne diseases, a bad strategy is existing Natural Ventilation paradigms. But a very good modification is to give each tenant within a building their own compartmentalized natural ventilation airflow. The idea is that each unit faces both the prevailing windward and leeward sides of the building. A condo so contructed would offer tenants rail boxcar-shaped units. Internal airflow from surrounding tenants would be lessened and the balconies would be located leeward. Property should be zoned based on windspeed of the site’s volume as well the surface roughness footprint it has on other such properties. This model might not work for the bottom few floors near busy areas. Airflow dries out most microbes. The hope is dilute microbes downwind aren’t very infectious as well as weather and cleaning crew processes dilute the downwind infectious effect, but a high density of buildings may ruin this safeguard. Other aerodynamic building surface features can be incorporated and heating and AC are needed if airflow is to be maximized.
Subsidizing the construction and planning here would have a powerful stimulus effect on the economy and newer building aren’t as leaky to other tenants.
Bal
at 7:03 pm
I support a balanced house market…..this way, sellers and buyers both are the winners…..house buying and selling process should be fun. But whenever it is buyers market….sellers suffer and whenever seller’s market…buyers suffer..give so much anxiety and worry. Wish greed end from the housing market.
Sohan
at 8:56 pm
Hi, real estate you have already touched the sky, Please come back to earth. I want to meet you. You can’t forget me. I am a Homeless person, like many many more thousands and thousands of proud Torontonians, and Canadians.
Chris
at 9:34 pm
“FLASH NEWS
Mortgages Rates go up across the Board
Fixed or Variable
Short or Long Term
Government insured or not
Everything up
The crisis is unforgiving, Bank of Canada can lower rates, governments can pour money on Bank’s balance sheets
Nothing cools risk”
– Ron Butler of Butler Mortgage, March 18, 2020
https://twitter.com/ronmortgageguy/status/1240404956953354241
Bal
at 9:51 pm
Where are you finding these news?…i searched Bnn?..financial post?…. Huffington?……unable to find such a news….all are showing that big banks slashed the rates.
Chris
at 9:58 pm
Twitter. Link is at the bottom of the post. Ron Butler is a mortgage broker and founder of Butler Mortgage. Maybe you’ve heard their ads on the radio?
Bal
at 10:33 pm
Okay…Thanks!
MortgageJake
at 2:04 pm
100% true. Cost of borrowing increasing for lenders which is passed to borrowers. The media does a good job of selling low rate environment but does not actually report on what’s going on.
Rates hit 1.99 2 weeks ago are 2.49 today. The 2.49s are 2.99.
I think it’ll stabilize. The variable-rate game is dead now. We used to be Prime-1 now we’re prime. I’m generalizing but it’s true.
Chris
at 2:26 pm
Thanks for verifying, Jake. I don’t know how many deals you do, but I would assume it’s enough for you to have your finger on the pulse of mortgage rates.
Max
at 8:07 am
I’m so glad I live in a house and not a condo in an intensified area. I think this virus will change the way our government thinks about their future policies for intensification. So the virus lasts 3 hours in the air droplets? What happens when somebody coughs in an elevator? People have to stop relying on the government telling them what to do before taking precautions for themselves. Smart people withe money will buy a house now over a condo.
J G
at 6:03 pm
Good points, I agree. I think over the next 5 years house will outperform condo in GTA
Appraiser
at 9:04 am
‘Bully Offers’ Eclipse Virus Woes in Canada’s Home Market:
“In the longer run, relentless demand means any pullback will likely be short-lived and prices should hold up, said Robert Hogue, senior economist at RBC.
“In all likelihood, this will be a temporary hit with a rebound taking place later this year once the Covid-19 situation settles down — though the timing and magnitude of the rebound are highly uncertain at this point,” Hogue said in a research note this week.”
https://www.bloomberg.com/news/articles/2020-03-18/-bully-offers-eclipse-virus-woes-in-canada-s-home-market
Chris
at 9:27 am
“Toronto’s real estate market is still active and competitive but I do think we are going to see activity slow down in the weeks ahead.“ – John Pasalis
“I don’t enjoy saying it but CDN housing will hurt here
2 text msgs from friends this morning
mortgage broker: “1st client reached out b/c shes going to miss her mortgage payment”
real estate agent: “all my visitations are cancelled. Nobody’s holding them, nobody’s going to them.”” – Frances Donald, Global Chief Economist & Head of Macro Strategy for Manulife Investment Management
“Looks like we’ve hit 2 out of the 3 “or” conditions for popping a real estate bubble in the last sentence.” – Scott Ingram, referring to UBS’ bubble index
“Sorry RE folks- anyone who thinks this is just a little blip and RE will be back to normal in a month or two is misguided. A massive economic meltdown. growing pandemic and massive job loss cannot support a bull RE market. The flip from Seller to Buyers market will be swift“ – Donna Bacher, PureRealty Brokerage
Appraiser
at 10:11 am
How about some real-time data instead of conjecture and anecdotes? Okay.
Just did a quick analysis of all of the TRREB sales reported so far for yesterday (March 18, 2020).
49 freehold sales – 32 sold at or above asking price (65%)
32 Condo Sales – 24 sold at or above asking price (75%).
The number of transactions are down slightly, but prices keep surging.
Hmmmmm…whodathunkit?
Chris
at 10:19 am
“Sold at or above asking” does not equate to “prices keep surging”. You’re in the industry, you should know that. David has talked ad nauseam about listing low to attract attention.
Let’s see what average price is, and how it develops over coming weeks and months.
Appraiser
at 11:43 am
Regardless of list price, multiple offers at theses levels are clearly indicative of excess demand and rising prices.
Always in denial.
Always behind the curve.
Amateur.
Chris
at 11:47 am
Once again, “Sold at or above asking” does not equate to “prices keep surging”. If I list a condo for $1, and it gets multiple offers and sells for $500,000, yet an identical unit sold last month for $550,000, I have both sold it over asking yet price has not surged.
Come on, it doesn’t take a mathematician to figure this out. Use your head. Expend some energy on critical thinking rather than childish insults.
Natrx
at 11:32 am
How about you flex your Mighty Muscles Mr. Appraiser. Such a BEAST you are. B E A S T
M O D E
A C T I V A T E D
Appraiser
at 11:38 am
May I suggest anger management…or at least psychotherapy ?
Chris
at 11:44 am
You’re reaping what you sowed, appraiser. When you talk rudely and childishly to people, don’t be surprised when they start to respond in kind.
Brings down the level of discourse of the entire blog.
Appraiser
at 11:53 am
P.S.
It seems that only Chris.
He and he alone.
Has the capacity to bend the demand curve.
Chris
at 11:54 am
Stop being a child, appraiser. It’s tiresome.
Bal
at 9:33 am
Lol….i read this on BNN today and came to see if you mentioned and Bingo….
J G
at 10:39 am
http://www.cnbc.com/amp/2020/03/19/coronavirus-airbnb-hosts-angry-at-refunds.html
Ouch! This could go on for a while. Maybe landlord will have to put it up for rental? But if they switch it will be hard to change it back to airbnb if virus situation improves. Tough choices… meanwhile, property tax, insurance, mortgage, condo fees still need to be paid.
Chris
at 11:20 am
Yep, Globe had an article on this subject specific to Toronto the other week. Unclear at this point if mortgage deferrals will be extended to principal residences only, or also to long term and short term rental properties. Cash flow could become a real issue for some of these people banking on AirBnB revenues.
Appraiser
at 12:11 pm
The ABB issue is a complete red herring. Just keeps you bears excited.
If all of the ABB units immediately returned to the long-term rental market, as unlikely as that is, or all of them were to be immediately listed for sale, as unlikely as that also is, it would be a one-time inventory uptick to the existing real estate inventory.
Which it badly needs.
Chris
at 1:16 pm
Any data to support AirBnB issue being a red herring? Or is this just conjecture, akin to the kind you railed against a couple hours ago?
Any supply helps. That’s Econ 101.
J G
at 1:19 pm
Condo fees, property tax, insurance, mortgage, tick tock..
Mxyzptlk
at 11:50 am
Sales, prices, etc. for the first three weeks of March are meaningless, ditto the next week or so. Who cares how many homes get sold today? Or tomorrow? Or the next day? (Well, Appraiser cares, or at least pretends to.) Let’s have a little patience and see how things are looking in, let’s say, mid-April.
Chris
at 11:55 am
Bingo. Going to take time for all this to manifest. Appraiser is celebrating lagging indicators as though they were a guarantee for the future.
Mxyzptlk
at 12:37 pm
Speaking of lagging indicators:
S&P/TSX Composite down 12.3% last Thursday. Then up 9.7% the next day. Then down 9.9% on Monday. Then up 2.6% on Tuesday. Then down 7.6% yesterday. Now up 1.7% at 12:30 this afternoon.
Anyone want to bet what Monday’s figure will be (or today’s close, for that matter)?
Chris
at 1:21 pm
The volatility has been pretty incredible lately. I’m just sticking to the same investing plan. Ignoring the noise. Makes for entertaining headlines though.
Appraiser
at 12:13 pm
I’ll be watching demand each day and keep y’all posted.
When the apocalypse comes, you’ll be informed.
Chris
at 1:18 pm
That’s alright, John Pasalis is going to be doing weekly updates. As many of the comments here demonstrate, I think most of us will be turning to him for reliable info, over you. But thanks anyways!
MortgageJake
at 2:06 pm
A daily report would be time-consuming but pretty soon 95% of Realtors won’t have much to do. Someone with a lot of time on their hands and a data-scraping appetite could come out of this with a clear lead.
A weekly report will help, too, though. And John’s numbers are usually good.
Appraiser
at 2:28 pm
95% ?
Let’s not exaggerate shall we.
Time to get a fire extinguisher to put that hair out Jake.
Appraiser
at 2:46 pm
Weekly doesn’t cut it right now.
Chris
at 3:01 pm
Wrong again, appraiser:
“This will be very helpful. Suggestion: there are strong “day of the week” effects so reporting in 7 day increments avoids that source of distortion.”
– Will Dunning, Chief Economist for Mortgage Professionals Canada, March 19, 2020
https://twitter.com/LooseCannonEcon/status/1240659228727160832
Let’s stick to weekly reporting from those with “boots on the ground”, and good reputations, like John. But thanks for the offer.
Appraiser
at 2:44 pm
Quick update as more data comes in for yesterday, March 18.
Freehold sales 96
Sales at /over asking price 65.
Almost 70% of freehold sales are over asking price.
Chris
at 3:04 pm
No info on change in sales volume. No info on change in listings volume. No info on average price. No useful info provided.
Will wait for John Pasalis’ updates for reliable, unbiased, and suitable data.
Derek
at 3:12 pm
Do you two know what you’re even arguing about anymore?
Chris
at 3:14 pm
There’s more than one ongoing at a time. In this case, appraiser’s updates and their usefulness, or lack thereof.
Derek
at 3:22 pm
I don’t think anyone expects any poster to be capable of contributing a comprehensive thesis of the past present and future of the market. All contributions or updates or anecdotes are interesting reads to pass the time, in my view.
Appraiser
at 3:18 pm
Yeah, demand thus far is still very strong. Chris thinks otherwise.
The data proves him wrong.
Again.
Chris
at 3:25 pm
We’ll wait for reliable data from Pasalis, then we’ll see. But keep trying to proclaim otherwise. Doesn’t change reality.
Appraiser
at 3:17 pm
It’s O.K. Chris, if you don’t like the data, you can ignore it.
Highest priced sale March 18.
21 Unsworth Ave. (Lawrence Park) List $2,199,000 Sold $2,460,000
Lowest priced sale:
371 Ormond Dr. Oshawa List Price $434,900 Sold $475,000.
Chris
at 3:22 pm
Nothing to do with liking or not liking it. You’re not presenting any useful information. Cherry picking sales is a useless exercise as well.
Keep providing shallow stats to your heart’s content. But based on replies from J G, Mxyzptlk, MortgageJake, and Natrx, I somehow doubt I’ll be the only one dismissing them as futile.
Appraiser
at 3:39 pm
Here’s some more “cherry-picked” data. This is the part where you close your eyes, cover your ears and say blah! blah! blah! out loud.
225 Palmerston List $1,699,999 Sold $1,875,000
60 Doncaster List $1,299,900 Sold $1,511,000
56 Doncaster List $1,149,000 Sold $1,330,000
46 Norgrove List $1,249,999 Sold $1,380,000
33 Angus Dr List $952,000 Sold $1,060,000
Chris
at 4:11 pm
It’s shocking that someone as old as you are can behave like such a child.
Appraiser
at 5:55 pm
Sales volume update. March 1 – 15, 2020 vs. same period 2019.
Freehold sales month to date 2020 = 2,997. 2019 = 2,158. Increase of +28%
Condo sales 2020 = 1,583 . 2019 = 1,325. Increase of +16%.
Chris
at 6:37 pm
That’s a more useful collection of data. If you want to improve further, do active listings and average price as well.
And, since beginning of March was pre-pandemic, let’s see how the latter half, plus coming months play out.
Appraiser
at 8:36 pm
Really?
Pandemic started long before March 1.
Doesn’t matter much though, because when the March print comes out you’ll say let’s wait till April, after all half of March was pre-pandemic.
Then May… followed by June.
You’ve said the same thing for 3 years.
Chris
at 9:20 pm
No, sorry but you are wrong again.
On March 1st, Canada had 19 cases of Covid-19. Today we have 569. No sports leagues had been cancelled, the border hadn’t been closed, even Italy was only at 1,700 cases (compared to 35,700 today). WHO was 10 days away from declaring it a pandemic. The environment, economically, politically, socially, was completely different.
All of this information is readily available. Try a Google search before you make a statement next time; it will help you avoid these kind of mistakes.
Derek
at 12:13 am
Apparently March 2019 condo sales were the lowest in 18 years?
Chris
at 3:32 pm
“Once people start losing income, and there’s a sizeable minority of homeowners that are already on the edge, it doesn’t take a heck of a lot of income loss to make them insolvent, and once you see that happening and you see this dramatic drop in spending we’re about to see, it’s going to filter through to housing. If I were a renter right now, I would not be rushing in to buy my first home.”
– Rob McLister, Founder of RateSpy.Com
https://www.bnnbloomberg.ca/video/~1924335
Appraiser
at 3:44 pm
I respect Rob McLister a great deal. But it’s just an opinion and is based on conjecture.
I lived through 1989 as a sales rep. The market almost came to a standstill overnight.
There were almost no offers at all, let alone multiple offers every single day.
This is not even close.
Oh, and we all survived 1989.
Appraiser
at 3:53 pm
Potential Overreaction: “Selection bias and other statistical errors are unnecessarily driving our economy to the brink, argues this Stanford professor. Once the market senses things aren’t as bad as advertised, we’ll see a rally like never before. Either way, standing in front of a herd of wildebeest is ill advised, even if you know they’re about to run off a cliff.”
https://www.ratespy.com/coronavirus-mortgage-update-march-19-031912545
Chris
at 4:14 pm
The market declined quite dramatically after 1989.
Nobody is suggesting Covid-19 is going to kill us all, but a decline is certainly plausible. Your opinion is that it won’t; I’ve shared opinions of those in the industry who disagree with your assessment.
J G
at 6:14 pm
Everyone survives, my portfolio just survived a 30% flash crash like the one is 1987. I didnt panic, just bought small chucks as it went down.
But what about the family making 120k combined with two kids who has an investment condo that’s not flowing?
Appraiser
at 8:15 pm
Straw man argument.
And a mostly incoherent one at that.
Sohan
at 11:21 pm
Death is coming to strangers and loved ones. You are still talking about GREEDY real estate. Shame on you. I think you only like money not your self, not friends, not Family.