December 2021 Toronto Market Report

In 2021 we experienced an unprecedented residential resale market. More records were shattered in 2021 than in any other year of record keeping – sales prices, properties sold, and, unfortunately, inventory levels all established new records. As we end 2021 and move into 2022, it will be inventory that will have the greatest impact on the resale market.

Let’s begin with December’s data.

Sales declined in December as compared to 2020 only because of a lack of inventory. Demand continues to be at record breaking levels, but to put it bluntly, there just weren’t enough properties on the market for buyers to purchase. That is dramatically illustrated by the fact notwithstanding declining sales, the average sale price for all properties sold, including condominium apartments, came in at $1,157,849, 24.2 percent higher than December 2020.

It should be noted that increases in average sale prices were substantially higher in the 905 region as compared to price increase in the City of Toronto, as the chart below clearly illustrates.

The increase in average sale prices in the 905 region during the pandemic has been nothing but stunning. As forecast in a monthly Market Report earlier in 2021, the difference in average sale price between properties in the City of Toronto and the 905 region has all but disappeared. The reasons for this market change are due to the pandemic driving buyers away from the denser concentration of population in the City of Toronto, the ability to work remotely, affordability, and supply. It would now appear the attraction of supply and affordability may no longer exist.

The luxury end of the resale market also broke records in 2021. In December 473 properties traded hands having a sale price of $2 Million or more. Last year only 287 properties sold in this price category. On a year-to- date comparison, 7,807 properties valued at $2 Million or more sold in 2021 compared to only 3,649 last year, an increase of 114 percent. Sales in the 905 region in this category contributed substantially to this increase in 2021. Detached property sales in Oakville, King, Richmond Hill, Whitchurch-Stouffville and Uxbridge all came in with average sale prices in excess of $2 Million, with King approaching an average sale price of $3 Million. Historically this only happened in central Toronto.

Throughout the greater Toronto area average sale prices continued to be eye-poppingly higher than asking prices. This is also a strong indicator of demand, first witnessed after buyers adjusted to the protocols of viewing and buying properties during the first wave of the pandemic in May and June of 2020. For example, in Oshawa, all properties presented to the market sold in only 9 (yes 9!) days at sale prices 121 percent of their asking price. The case was the same in Pickering. Two trading areas in Toronto also exceeded sale prices of 120 percent or more than asking prices. We are short of superlatives to describe this phenomenon.

In 2021, the condominium apartment sector came back very robustly after pandemic fears in 2020 caused it to shrink dramatically. With that revived interest in condominium apartment living came rising prices, and perhaps most shockingly, the disappearance of condominium apartment inventory. In central Toronto, where most condominium apartments are located, 977 sold in December, last year over 1,000 apartments sold in the same trading area. The decline was due to lack of supply. On the price side, those 977 condominium apartments sold for $790,611, almost 20 percent higher than last December’s average sale price of $669,000.

The decline in condominium apartment supply over the course of 2021 has been breathtaking. In December of 2020 there were 4,294 active condominium apartment listings in the greater Toronto area, and 3,120 in the City of Toronto, the bulk of those to be found in the central core of the city. As 2021 comes to a close, there were only 1,488 active listings in the entire greater Toronto area and a paltry 1,189 in the City of Toronto, 20 percent fewer than the 1,447 condominium apartments that sold in December! The only source of affordable housing is disappearing.

Overall, 2021 proved to be the strongest year in recorded resale history. Total number of sales for the year came in at 121,712 surpassing 2016, the previous best year, by more than 7 percent. In 2016 113,040 properties traded hands. During 2021, except for January ($966,068) every month saw the average sale price exceed $1 Million, with November setting a new record at $1,163,287. A truly exceptional year!

How the market performs in 2022 will depend entirely on supply. December’s numbers are not encouraging. During December 5,174 new properties came to market, almost 12 percent fewer than came to market in 2020. What is even more shocking is the fact that entering 2022 there are only 3,232 active listings for the entire greater Toronto area, more than 46 percent of which are condominium apartments. By contrast last year there were 7,892 active listings which at the time we reported were totally inadequate to meet the growing pandemic demand.

Many economists have deemed 1996 to be the year that the Toronto and area market broke from its six year recessional slide and began to show signs of strength and robustness that have continued through to today’s market. That year set a record for sales at 55,779. In 1996 the population of the greater Toronto area was approximately 4.2 million people. Since then the population of the greater Toronto area has grown to well over 7 million people. In December of 1996 the Toronto Real Estate Board reported that there were 16,964 active listings available to buyers in the greater Toronto area. At 3,232 active listings this December, we find ourselves with only 1⁄4 of the listings available to buyers in 1996, and we have a lot more buyers.

So supply will be the major driver in 2022. As immigration numbers to the greater Toronto area will continue to increase, even more supply will be necessary. It will take aggressive, innovative, and rapid thinking, planning and decision-making by all three levels of government alleviate this housing crunch.


November 2021 Toronto Market Report

With one month still remaining in 2021, November’s reported sales brought the total year-to-date sales to 115,716 residential properties sold. We will finish the year with approximately 122,000 sales, eclipsing the previous annual record for properties sold in 2016. In that year 113,040 properties traded hands. As will become evident, given the supply problems the market is experiencing, 2021’s record-breaking accomplishment is not likely to be surpassed for some time, and definitely not in 2022.

In November 9,017 residential properties were reported sold, also a record number for any previous November. Last year 8,728 properties were sold, 3.3 percent fewer than this November. The big news coming out of the November data, aside from the new records achieved, was what’s happening to prices and the region’s disappearing inventory.

In addition to being the strongest November on record, and breaking the annual record for total sales, November saw the Toronto and area average sale price climb into record territory. The average sale price for all properties reported sold came in at $1,163,323, almost 22 percent higher than last year’s average sale price ($955,889). November marks the sixth consecutive month of monthly increases. This streak started in June when the average sale price was a “mere” $1,089,135, 7 percent less than the average sale price for November. The pace of these monthly increases in average sale price began to accelerate in September when it became evident that the Toronto and area supply problem was moving from chronic to dangerous.

The supply problem became even worse in November. Only 10,036 new listings came to market in November, 13.2 percent fewer than the 11,556 that came to market last year. Given the absorption rate – 9,017 properties were reported sold, almost the same number as came to market – combined with the few listings that realtors were able to bring to the market, we find ourselves entering December with only 6,086 properties available to buyers, an eye-popping 56 percent fewer listings (13,798) than at the same time last year.

As unbelievable as these numbers are, depending on housing type and neighbourhood, the situation is even direr. For example, there were trading districts that reported no sales of semi-detached properties for November. The reason no sales were reported is due to the unnerving fact that no semi-detached properties came to market in November in those trading areas.

No surprise that sales of all types of properties were happening at lightning speed. In the City of Toronto, all detached properties were reported sold in just 13 days. Semi-detached properties sold in just 11 days. In the 905 region, all semi-detached properties that came to market in November sold in a mere 8 days with some trading areas reporting sales at an even faster pace. All sales of semi-detached properties in Halton, which includes Burlington, Milton, and Oakville, were processed in only 4 days!

Another milestone that was achieved in November was months of inventory. Given the data in this report, it won’t surprise anyone that for the first time months of inventory for the greater Toronto area dropped below one month. For the entire region, months of inventory came in at 0.9 months. In some trading areas, this number was, unbelievably, even lower. Durham region, which includes Ajax, Uxbridge, Oshawa, and Pickering ended the month with only 0.5 months of inventory.