The Canadian Press
Home sales are showing signs of improvement in the Toronto real estate market, but economists say it’s too early to feel optimistic about a recovery from the devastating effects of the COVID-19 pandemic.
“The hole is very, very deep to dig ourselves out of,” said Robert Hogue, senior economist at Royal Bank.
Activity in the region improved in May compared to April, according to Toronto Regional Real Estate Board figures, but remained less than half of what TREB saw a year ago.
There were 4,606 sales in the Greater Toronto Area through the board’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.
“It’s completely in line with what I expected and I think … you’ll see that continue into June,” he said.
“So while sales figures are (still) down, do people care how many units are selling or do they care what the prices are?” 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 at Dominion Lending Centres.
But with the COVID-19 shutdowns, the “period of adjustment” remains uncertain, especially when considering low interest rates against a surge in unemployment, she said.
“They’re opposing forces,” she said of those two factors.
“I don’t think we’re going to see gangbuster home sales, but I do think they’re certainly going to come off the bottom.”