August in slower pace

With elections coming, real estate market is one of the most important areas for politicians. After very successful year 2007 expected slowdown came, disturbing some people and also some professionals, scared by the situation in the USA. Sales dropped some 20% compared to the year 2007 and…nothing else. Other indicators remain stabilized, thus backing optimistic predictions. Market shows no traces of panic or bubble burst.

Starting with sales, there has been significant drop in August, not only compared to August 2007 (-22%), but also to August 2006 (-9%). As in previous month, the City of Toronto has been more affected and we have seen even average price going down 1%. On the other hand, 2% rise for the rest of Toronto area resulted in stabilized 1% growth in overall area.

Very closely watched indicator – new listings – declined 1%, so there is definitely no uncontrolled flow of new listings into market. Active listings are some 31% higher than the last year’s, but market is still fast turning and average days on market rose to mild 35 days.

There were no unexpected results for August and real estate worries from the spring seem slowly to fade away. Autumn results may be influenced by our elections, it’s probable that the winner will try to open the  market more for the first-time buyers (there was tax reduction presented few weeks ago), so we will see…

As a member of real estate in Toronto business I remain pretty optimistic and I believe this year’s market will not go much under the year 2006.