A month after the Toronto Regional Real Estate Board (TRREB) released their April report on the Greater Toronto Area housing market which showed an unprecedented drop in sales, their May report is showing an increase in activity as worries over the COVID-19 pandemic begin to subside among buyers. The latest TRREB report shows significant month-over-month gains in the number of sales in May, while year-over-year comparisons serve as a reminder that market activity is still well below what was being seen at this time in 2019.

Toronto skyline, image by Forum contributor skycandy

A total of 4,606 sales were recorded in May, 2020, a substantial drop of 53.7% measured year-over-year against the 9,950 sales recorded during the same period in 2019. This is still an improvement over the 67.1% year-over-year decline reported for April, 2020. Measured month-over-month, actual May sales increased by 55.2%, while seasonally adjusted May sales increased by 53.2%. Similarly, listings took a big drop year-over-year last month, mirroring the drop in sales with a dip by 53.1% to 9,104. As with sales, the month-over-month metric for May shows a major improvement over the chaos of April, rising by 47.5%.

“While the public health and economic concerns surrounding COVID-19 continue to impact the housing market, the May sales result represented a marked improvement over April. TRREB released updated Ipsos consumer intentions polling results in May that indicated that 27 per cent of GTA households were likely to purchase a home over the next year. Providing we continue to see a gradual re-opening of the economy, it is very possible that home sales will continue to improve in the coming months,” reads a statement from TRREB President Michael Collins.

Declines in both supply and demand as well as a global pandemic have had little impact on inflating home prices. Despite these factors, the average selling price for all home types combined climbed by 3% last month compared to May, 2019, and rising by an even more pronounced 4.6% measured month-over-month. The average price of a GTA home now sits at $863,599. 

“With home sales and new listings continuing to trend in unison in May, market conditions remained balanced. This balance was evidenced by year-over-year average price growth slightly above the Bank of Canada’s long-term target for inflation. If current market conditions are sustained during the gradual re-opening of the GTA economy, a moderate pace of year-over-year price growth could continue as we move through the spring and summer months,” reads a statement from Jason Mercer, TRREB’s Chief Market Analyst.

The pandemic and associated economic meltdown has also thrown cold water on the condominium apartment rental market, with expected year-over-year declines in one- and two-bedroom condominium apartment rental transactions recorded in May. One-bedroom rental transactions fell by 30.8% while two-bedroom transactions fell by 26.7%. These changes follow the same trends as home sales, with improvements evident when measured month-over-month. The 1,290 one-bedroom rental transaction recorded in May is a huge iprovement from the 754 recorded in April, while two-bedroom rental transactions increased from 489 to 820 in the same period. Average rents for one-bedroom condo rentals dropped by 5.1% year-over-year to $2,086, while two-bedroom rents fell 5.6% to $2,740.