One brokerage crunched the numbers for sales since the introduction of Ontario’s housing plan and the results are worrying
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One brokerage crunched the numbers for sales since the introduction of Ontario’s housing plan and the results are worrying.
Freehold home sales in the Greater Toronto Area are down 26% year-over-year for the 30 days following last month’s introduction of Ontario’s Fair Housing Plan, according to data compiled by John Pasalis, president of Realosophy Realty, a Toronto-based brokerage.
“Of course it’s cause for a bit of concern. It’s a significant decline, especially given the fact that it’s not proportional across the GTA. Certain areas are getting hit harder than others,” Pasalis told MortgageBrokerNews.ca. “And that coupled with the big surge in listings … it’s cause for some concern because especially in the short-term, the concern is sellers who have bought their homes and now have their properties in the market … are having a very hard time selling.”
Freehold home sales were down in 10 of 12 researched markets, led by Richmond Hill (-62.1%) and followed by Stouffville (-49.3%), Markham (-46.2%), Newmarket (-44%), Vaughan (-34.3%), Aurora (-31.2%), Mississauga (-27.4%), and Toronto (-23.3%).
According to Pasalis, the cooling of the market isn’t the big concern – he argues it was needed – it’s the rate at which it appears to be cooling.
“You can imagine it’s stressful for sellers who need to sell their house. The worst case scenario is what if they can’t sell it, or what if they can’t sell it at a price they need to in order to buy their next one?” he said. “You have to imagine ... they bought a house assuming they’d sell their current home at a certain price and that price was based on April or March 2017 numbers. And if they’re getting 10% less now because there’s so much inventory and there are more buyers, even if they sell it they may not be able to afford their next one.”
As for the reasons behind Toronto’s real estate cooling, Pasalis argues it’s mostly due to public perception as opposed to the actual policies, which included a 15% foreign buyer tax.
“It certainly may have triggered people to think about the market and get anxious about it, but I don’t think the policies in and of themselves cooled demand,” he said.
Freehold home sales in the Greater Toronto Area are down 26% year-over-year for the 30 days following last month’s introduction of Ontario’s Fair Housing Plan, according to data compiled by John Pasalis, president of Realosophy Realty, a Toronto-based brokerage.
“Of course it’s cause for a bit of concern. It’s a significant decline, especially given the fact that it’s not proportional across the GTA. Certain areas are getting hit harder than others,” Pasalis told MortgageBrokerNews.ca. “And that coupled with the big surge in listings … it’s cause for some concern because especially in the short-term, the concern is sellers who have bought their homes and now have their properties in the market … are having a very hard time selling.”
Freehold home sales were down in 10 of 12 researched markets, led by Richmond Hill (-62.1%) and followed by Stouffville (-49.3%), Markham (-46.2%), Newmarket (-44%), Vaughan (-34.3%), Aurora (-31.2%), Mississauga (-27.4%), and Toronto (-23.3%).
According to Pasalis, the cooling of the market isn’t the big concern – he argues it was needed – it’s the rate at which it appears to be cooling.
“You can imagine it’s stressful for sellers who need to sell their house. The worst case scenario is what if they can’t sell it, or what if they can’t sell it at a price they need to in order to buy their next one?” he said. “You have to imagine ... they bought a house assuming they’d sell their current home at a certain price and that price was based on April or March 2017 numbers. And if they’re getting 10% less now because there’s so much inventory and there are more buyers, even if they sell it they may not be able to afford their next one.”
As for the reasons behind Toronto’s real estate cooling, Pasalis argues it’s mostly due to public perception as opposed to the actual policies, which included a 15% foreign buyer tax.
“It certainly may have triggered people to think about the market and get anxious about it, but I don’t think the policies in and of themselves cooled demand,” he said.
