May Blog - sherilleonhomes
Sherille Layton

For any of you that study the homes for sale street activity, you will understand that we have come out of a slow listing period year to date. Well, let me tell you this changed in May, as it became the busiest month of the year so far and seems to be the precursor to what will be a busy spring market in Toronto.

That said this type of inconsistency leaves buyers’ and sellers’ alike a bit confused. Natural question around whether the market is ‘balancing’ or if it is still a sellers’ market or transitioning in to a buyers’ market are being asked by some. My answer to which may be a little unsatisfactory as it depends on location, price point, and product.

Given the variable nature of the market, the most important thing right now is to get the pricing right. Not reading the specific market can be the difference between doing well and not so well. Some properties are sitting in hope of an unrealistic offer and risk price reduction exposing them to no offers at all and many days on the market and others that are accurately valued are coming across multiple offer situations.

My experience in this market has seen that those buyers and sellers that listen and use the expertise of their agents are doing well. We are in a fluid market currently where property value is changing where market intelligence and day to day experience of your realtor is the advantage to be leveraged.

That said the market is going to revert back to one that is more predictable soon, as commitment by banks to stabilize and indeed drop interest rates seems to be more known.

Even though the mortgage stress test which has been around for a year and a half will not disappear, there are rumours that it will become a little more flexible.

Jason Friesen, MD of Outline Financial and our KW Portfolio in house mortgage broker, had this to say:

The spring market is in full force and the competition between banks has continued to stay hot. Rates have continued to drop and we are now seeing rates below 3% once again! This is the first time in almost 2 years that we have witnessed the 5 yr fixed rate drop below the 3% mark. This is great news for buyers looking to enter the real estate market or those who have a mortgage coming up for renewal. The most likely scenario is that we will continue to see downward pressure on interest rates throughout the short to medium term. In the most recent Bank of Canada rate announcement, they backed off their previous stance that higher interest rates were around the corner. It does look like consumers can expect to see lower than normal interest rates for the foreseeable future. 

Year to date the market has slowed down, but with a consistent interest rate message consumer confidence is bouncing back. If the rates remain low this will be positive news for the Toronto real estate market.