COVID19 – Toronto Home Sales Fell 16% in March’s Second Half

Friday Aug 07th, 2020

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The home sales had a solid record in March 2019 as it rose by 12.3 percent as compare to the sales in March 2020, informed data released by the Regional Real Estate Board of Toronto (TRREB).There has been a drastic decline in activity during the second half of March. This is the first of many data reports which illustrate the impacts of the COVID19 pandemic on the region's housing market. 

Of the 8,012 homes sold in March in the Toronto region, 4,643 occurred in the first half of the month, while the back half saw only 3,369 sales as COVID-19 fears began to hit home and stringent social distancing measures were rolled out to combat the spread of the virus. The total home sales for the second half of March in 2019 were down nearly 16 percent over the same period.

"March's overall sales performance was high compared to last year, but COVID-19's influence was definitely noticeable in the amount of sales registered in the second half of March," TRREB president Michael Collins said in a press release.

"Uncertainty surrounding the effect of the outbreak on the wider economy and the implementation of the requisite social distancing steps resulted in revenues declining as of March 15. April sales figures will give us a clearer understanding of the demand trend as all levels of government are taking the appropriate steps to control the COVID-19 spread.

Similar to the pattern observed in home sales, as opposed to the same timeframe in March 2019, new listings also dropped during the second half of the month. The month's total number of new listings was 14,424, up a mere 3 per cent from the previous year.

TRREB Chief Market Analyst Jason Mercer said that overall market activity rates in March continued to help price increases year-over-year following a fall later in the month. TRREB's MLS benchmark price rose 11.1 percent in March, while the Toronto region's average sales price for the month was $902,680, up to 14.5 percent over the previous year.

“As we move through April, we will have a clearer view on how social distancing measures and broader economic conditions will influence sales and ultimately the pace of price growth,” said Mercer.

In the recent report, TRREB said it would issue an update to its mid-April 2020 forecast for the region when more data on the effect of social distancing initiatives as well as economic growth and jobs will be discussed.

If it stands right now, if COVID-19 infections occur in the spring and strict social distancing policies are subsequently relaxed over the summer then demand on the market will increase in the winter season.

“News of employees returning to work from furlough coupled with the continuation of extremely low mortgage rates could fuel this recovery,” said TRREB.

Since COVID 19 is a global pandemic, real estate industry is facing problems just like any other business. There is a significant increase in the cases of coronavirus patients in the United States. However, we can hope that the month of April will be better than March in terms of real estate business.

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