We should not be surprised when citizens expect a market crash, or something to go the opposite way. There is a housing crisis, and it is currently being tackled as a social issue by getting voter support.
The Toronto Regional Real Estate Board released its August sales figures this afternoon, confirming what many had expected: We’re closing out a slow summer within the tightest real estate market in recent memory.
That might make you think that the market is about to collapse – that buyers have finally realized what is going on and are either losing confidence or becoming more prudent, depending on your perspective. Is this the ‘dreamed of’ crash? As it stands, we are nowhere near that. In other words, no.
Besides the high selling prices, we are seeing that there are less than half as many homes available as there were last August. The number of sales will, of course, be affected by that. As a result, all preapproval buyers have very few options available to them. The norm continues to be multiple offers.
In addition to reducing some of the pressure on prices, an increase in new listings will increase the overall number of sales. Even with a wave of new activity in the fall we are still far away from having sufficient housing supply to bring prices down until the structural conditions in our market change – low interest rates, limited supply, fierce competition.