2020 will be a year that no one will forget although many people would like to. It will always have an asterisk in the history books, even when looking at charts and statistics about the economy as there was nothing normal about it.

Toronto Real Estate was no different.  The following summary will outline “TRREB’S Year in Review” published on February 8th, 2021 focusing on both sales and rentals in the Toronto Residential Market with an even more specific look at the central core. 

2020 Review

The year started off promising and strong with the first quarter showing healthy numbers prior to March 15th, 2020 when the pandemic hit the country (and the world).  After the initial shock where there was basically no movement in the spring market. In the spring of 2020, Royal LePage, while in the depths of COVID predicted a flat or slight increase in prices depending on how the pandemic played out for the rest of the year.  CMHC, meanwhile, had a much gloomier forecast. They predicted a drop in prices (nationally) of 18% with foreclosures and the like becoming the norm and calling for a recession.

What we saw was the market rebound in the summer and fall. When the dust settled there was an overall increase of 13.5% to an average sold price of $929,699 and an increase in the number of sales of 8.4% to 95,151 thru the TRREB MLS network (the forecast one year ago for 2020 was 9.8% increase in price and 10.4% in number of sales).  Detached homes drove this price increase while in past years it was condo sales that pushed averages up.

2021 Forecast

The estimates for this year remain bullish in the GTA, with an estimated increase in the price of a home to go over $1,000,000 or 10% to $1,025,000 and unit sales eclipsing 100,000 units (the first time since 2016) to an estimated 105,000 sales.  

With record low interest rates (having we been saying this for a few years?) of sub 1.75% (with no talk of any changes through 2021) and vaccines coming on the horizon and a loosening up of business restrictions, possible immigration continuing, the percentage of those polled was up slightly from 2020 when asked if they planned to purchase their first home in 2021.  

Rental Market

The condo rental market took a hard hit this year with rents decreasing 15-20% in the downtown core where the greatest density of rental condos are located.  Condo rental transactions increased by 21% on TRREB from 2019 to 2020.  The shut down of Airbnb type rentals, vacancy taxes, people not renewing leases as being located downtown became less important and other COVID realities lead to many owners to have to list their units for rent.  Savvy landlords were pre-emptively offering discounts or rent reductions to their tenants and tenants were able to upgrade to other units for less money.

A typical two-bedroom condo that rented for $3,200 a year ago (and often had bidding wars or was being leased in one day) now sits empty for $2,600, $3,700 condos are leasing for $3,100 and so on.

Looking Forward

With immigration opening, foreign students starting to come back to Post Secondary and businesses re-opening the feeling is that the downward spiral on condo rental prices is coming to an end and we should see a stabilization and even an increase start to occur.  Studies say that we still have a shortage of housing in Toronto and if you look at the Skyline there does not seem to be a slow down of condo developments happening.

In general, the Toronto Real Estate market is showing a resiliency that should not be surprising.  When North American and Worldwide hardship both economic and societal has occurred in the past, Canada, and Toronto, specifically, have proven to be an exceptional place to live, raise a family and invest in.

For the full report please click here:

https://trreb.ca/index.php/market-news/treb-market-year-in-review