Yesterday the Toronto Real Estate Board released their report for the first two weeks of January 2013. It shows that so far 2013 is off to a better start than 2012, sales and prices are both up. Surprised? If you’ve read any of the doomsday reports that have circulated through the national media about real estate and this City then the answer is most likely yes.
So is the sky really falling on Toronto real estate?
Let’s look at some numbers from this week so far. According to MLS, in the City of Toronto, of the freehold listings that have sold 44% of them have sold for over listed price.
Is this what a crash looks like? It certainly isn’t the vision I had after reading MacLean’s article entitled the “Great Canadian Real Estate crash of 2013” where they note, “The housing bubble has burst, and few will emerge unscathed” . (MacLean’s magazine article “Great Canadian real estate crash of 2013””, Wednesday, January 9, 2013).
The problem with predictions is if there is no prize for being right or wrong, then you can say anything you want, or rather anything is fair game. Since I started with MacLean’s let me continue using them as an example. They have been writing the same message since 2008 here are a few of the highlights from their articles to show you what I mean.
- “Why house prices may soon fall through the floor” (MacLean’s magazine article “Canada’s looming real estate crisis”, September 25, 2008 Cover Article)
- “Forget all the talk about a double-dip recession. In Canada, most signs point to a double-peak housing bubble” (MacLean’s magazine article “Awash in a sea of debt” Tuesday, February 2, 2010)
- “In some major housing markets like Toronto, the signs of a bubble are as glaring as ever” (MacLean’s magazine article “Time to panic about the housing market”, Tuesday, February 28, 2012)
- “The housing bubble has burst, and few will emerge unscathed” (MacLean’s magazine article “Great Canadian real estate crash of 2013””, Wednesday, January 9, 2013).
In the past four years they are batting 0 for 4, so that should give you some idea of how much credence you should put into their latest pronouncement.
Real estate market conditions are extremely important to those of you that currently own property and for those of you that are considering investing in it. So if you have questions, concerns or comments about the thoughts I have given you here please let me know, I’d be happy to discuss.