Toronto Real Estate Collapsing

Although it has not been receving much media attention of late (and that is why this website exists), the Toronto Real Estate Market really got hit hard in the latest period of December 2011. Traditionally December is a slower month than November in terms of real estate in general, but not this bad. According to the Toronto Real Estate Board’s figures, sales of 416 area code properties dropped from 3,027 to 1,948 from November to December which represents a whopping 36% drop. Sales of 905 area code properties dropped from 4,065 to 2,770 representing a decline of 32% month over month as well.

The average sales price of a property in the 416 area code fell from $524,805 in November to $474,270 in December. That is a drop of over $50,000. When combining both area codes (otherwise known as the GTA) from November to December, sales of detached homes dropped dropped 35%, condos dropped 31%, semi-detached dropped 37% and townhouses dropped 33%.  The biggest losers definitely in Toronto 416 where average prices for detached homes dropped $74,171, semi-detached homes dropped $44,912, townhouses dropped $45,886 and condo’s dropped $14,027.

With Canadians maxed out to their limits in terms of borrowing money (via debts) how will this progress towards the spring during a time when many people list their houses for sale? What happens when the very high demographic of baby boomers set to retire look to sell their homes to downsize or move to retirement communities? What if the unemployment situation in Canada worsens with the Global debt situation reaching records levels? What if interest rates rise due to market conditions? People who remember the early 80’s and early 90’s realize that Toronto’s real estate is in the midst of yet again a cyclical collapse.


2 Responses to “Toronto Real Estate Collapsing”

  1. January 13, 2012 at 7:21 pm

    Over here in the States there are many areas that are experiencing similar Real Estate environments. We can only hope we see some improvement this year.

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