Desmond Brown

The real estate market was cooling BEFORE new government regulations

25 April 2017
Desmond Brown

Our provincial government rolled out 16 new measures last week in an attempt to slow down our sizzling real estate market here in Toronto and the surrounding area. However, most of us who are selling in the Toronto market had already seen signs of a slight slowdown during this month of April. 

This is what I've observed:

  • Fewer offers are coming in on houses on offer nights
  • When multiple offers do come in, the selling prices aren't as high over the list prices as they were in January, February and March
  • Some listings aren't getting any offers on offer night
  • Houses are sitting on the market for sometimes weeks before selling
  • Price reductions on homes
  • Agents cancelling listings when offers don't come in and relisting them so they appear new and fresh, sometimes for a higher price
  • Some houses not selling at all
We're also seeing more homes coming on the market. This is either because it is currently our traditionally busier Spring market, or it's sellers panicking to get their houses listed as they anticipated the measures introduced by the Kathleen Wynne government.
 

As a realtor, I welcome a more balanced market with more supply, where buyers, especially first time buyers, actually have a chance to successfully purchase a home.

John Pasalis of Realosophy confirmed my observations about more inventory on the market in the Globe and Mail, saying that new listings of detached homes were 62% higher in the first week of April, compared to the same time last year. He also said stats showed the third consecutive week of an increase in listing inventory.

As a realtor, I welcome a more balanced market with more supply, where buyers, especially first time buyers, actually have a chance to successfully purchase a home. All things considered, and as I've said all along, no one can accurately say what is driving this market. 

The provincial government is targeting foreign buyers and investors with new taxes without having any concrete evidence or statistics that they're the culprits who are actually responsible. Of course one of the government's new measures is to immediately start tracking the nationality of buyers. As Barrie McKenna of the Globe and Mail said, "the province is applying fixes to a problem that it doesn't fully understand because it lacks reliable data". "It's like trying to run before you walk," he said

In my opinion, these measures implemented by the provincial Liberals are purely political, steps being taken by a desperate government that is lagging well behind in the polls. 

So as the market continues to cool, mainly because of the increase in supply during our Spring market, watch for Premier Kathleen Wynne and Finance Minister Charles Sousa to take all of the credit.

Check out this link for the details of the new provincial measures, which they've called Ontario's Fair Housing Plan.  https://news.ontario.ca/ mof/en/2017/04/ontarios-fair- housing-plan.html

Would you like to continue this conversation? Are you looking to buy or sell? If so, feel free to give me a call and we'll talk about how we can navigate this ever changing market together to get you the best real estate solution possible.
 
- Des, 416 568 1242
 
 

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