Toronto home sales up in May, but economists temper their optimism

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The Canadian Press

Home sales are showing signs ofย improvement in the Toronto real estate market, but economists sayย itโ€™s too early to feel optimistic about a recovery from the devastating effects of the COVID-19 pandemic.

โ€œThe hole is very, very deep to dig ourselves out of,โ€ said Robert Hogue, senior economist at Royal Bank.

Activityย in the region improved in May compared to April,ย according to Toronto Regional Real Estate Boardย figures, but remained less than half of whatย TREB saw a year ago.

There were 4,606 sales in the Greater Toronto Area through the boardโ€™s MLS system in May, down 53.7 per cent compared with a year earlier.

However, sales last month were up 55.2 per cent and the number of new listings (9,104) rose compared to the previous month, but fell 53 per cent year-over-year.

The average selling price rose three per cent from May 2019 to $863,599.

Those figures are enough to be optimistic about, considering the circumstances, said David Fleming, a broker at Bosley Real Estate David Fleming Group Inc.

โ€œItโ€™s completely in line with what I expected and I thinkย โ€ฆ youโ€™ll see that continue into June,โ€ he said.

โ€œSo while sales figuresย are (still) down, do people care how many units are selling or do they care what the prices are?โ€ he said.

The coronavirus knocked the wind out of what was expected to be among the strongest spring seasons in home-sales history, said Sherry Cooper, chief economist atย Dominion Lending Centres.

But with the COVID-19 shutdowns, the โ€œperiod of adjustmentโ€ remains uncertain, especially when considering low interest rates against a surge in unemployment, she said.

โ€œTheyโ€™re opposing forces,โ€ she said of those two factors.

โ€œI donโ€™t think weโ€™re going to see gangbuster home sales, but I do think theyโ€™re certainly going to come off the bottom.โ€

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