The Toronto Real Estate Board reported 8,082 home sales through TREB’s MLS® System in June 2018 – up 2.4% over the June 2017 result.
The average selling price in June edged up by 2% on a year-over-year basis to $807,871. While this is an interesting statistic, it does not reflect the reality of the market. The average price reflects the price of homes that have been selling. Because of the tightening of the mortgage rules those homes have generally been under $1,000,000 with 35% of them being condominiums, either apartments or townhouses, selling at an average price of about $575,000. These less expensive homes impact the “average selling price”.
The other misleading statistics are that the average sales price which was 99% of the asking price with the house selling in 21 days. These statistics are misleading because it has become the custom in the industry to cancel a listing that is not selling and to relist it at a new price. So in reality a property may have had their price adjusted several times before it finally sold and the averages are from the final listing and not from when the house was first placed for sale.
One fact that is undeniable is that if a property is on the market and hasn’t sold in 3 weeks, it is at least 5% over market value. Today with the Internet, everyone is aware of what a home should sell for. Even if an agent was able to sell a home over market value the home is generally appraised for mortgages and the mortgage would be declined because the house sold at too high a price for the neighbourhood.
We have moved into a more steady traditional real estate marketplace, taking the average home as much 30 - 60 days to sell. It takes that long because we have to find the one buyer that would pay the seller the maximum value for the home.
The real estate market may seem complicated at the present time but it really isn’t. If you or a friend are thinking of buying or selling please give me a call. Let me answer all of your questions and help you make a decision that is right for you and your family.
Have a great July!
Suzana ( Sue ) Davies