Where will the mar­ket head af­ter this sum­mer’s slump?

Our panel of ex­perts share their pre­dic­tions for the fall mar­ket and weigh in on why some pock­ets of Mid­town re­main white-hot while other ar­eas, such as York Mills, have seen a no­tice­able de­cline in sales

Bayview Post - - News -

ROUND­TABLE PAR­TIC­I­PANTS: BRAD LAMB

De­vel­oper, Lamb De­vel­op­ment Corp.

TIM HUDAK

CEO, On­tario Real Es­tate As­so­ci­a­tion

BARRY CO­HEN

The #1 Re/Max sales­per­son in Canada

BRIAN GLUCK­STEIN

Prin­ci­pal of Gluck­steinDe­sign

JEN­NIFER KEESMAAT

Chief Plan­ner & Ex­ec­u­tive Di­rec­tor, Plan­ning,City of Toronto

CO­HEN: BARRY

The GTA’s hous­ing mar­ket is ex­pected to show signs of im­prove­ment come fall. List­ings are fore­cast to match or fall short of last year’s lev­els as some sell­ers con­tinue to hold back, if only ini­tially. The new buy­ers are and will re­main cau­tious, es­pe­cially af­ter a par­tic­u­larly chal­leng­ing sum­mer. How­ever, once in­ven­tory lev­els come down and those who have been sit­ting on the fence make their moves, the mar­ket should firm up.

While prices may con­tinue to cor­rect in the short term, prices should level out and sta­bi­lize in months to come, and I wouldn’t be sur­prised to see a slight uptick in av­er­age in the fall. One should keep in mind that val­ues tra­di­tion­ally fall dur­ing the sum­mer months, and the 33 per cent gain re­ported in the spring was un­sus­tain­able and had nowhere to go but de­cline.

From an eco­nomic per­spec­tive, the fun­da­men­tals are strong. Un­em­ploy­ment rates are low, and job se­cu­rity is good, which was not the case dur­ing the ’89 cor­rec­tion.

KEESMAAT: JEN­NIFER

Mak­ing pre­dic­tions about the di­rec­tion of the mar­ket in the short term is al­ways chal­leng­ing. But I do agree with Barry that the fun­da­men­tals for Toronto re­main very strong. Un­em­ploy­ment is low, and [the city’s] an­nual Toronto Em­ploy­ment Sur­vey iden­ti­fied a new record in terms of the num­ber of jobs within Toronto. We can also con­sider other fac­tors that un­der­pin the city — a con­tin­u­ing in­flux of prom­i­nent in­ter­na­tional com­pa­nies, high rank­ings on liv­abil­ity in­dexes and a grow­ing global aware­ness of Toronto. Toronto in 2017 is a dif­fer­ent city than it was when it en­tered the last ma­jor mar­ket down­turn in the 1990s. So while we may see (and even wel­come) short-term cor­rec­tions in the real es­tate mar­ket, I am pos­i­tive about the long-term tra­jec­tory for Toronto. With that said, it is paramount that we plan and in­vest for this fu­ture to en­sure that the city achieves its full po­ten­tial in the com­ing decades.

LAMB: BRAD

I be­lieve that the Toronto real es­tate mar­ket will con­tinue to see price in­creases and vol­ume in­creases over the fall; how­ever, the za­ni­ness from Oc­to­ber 2016 to March 2017 is over. We’re back to a more sane mar­ket­place where price in­creases will likely be five to eight per cent per year. There is ab­so­lutely no rea­son why av­er­age prices will fall go­ing for­ward. The spring 2017 shock took place af­ter the premier made moves to cool ex­plod­ing de­mand. Those pol­icy moves will be mea­sured and ab­sorbed by buy­ers. They will re­al­ize that fun­da­men­tally noth­ing has changed, real es­tate prices will once again march for­ward. As long as the econ­omy is ex­pand­ing, jobs are be­ing formed, the un­em­ploy­ment rate re­mains low, va­cancy rates re­main low, com­mer­cial va­cancy rates stay low and in­ter­est rates stay low, not much can cause prices to fall. Peo­ple don’t stop buy­ing goods and ser­vices (in­clud­ing homes) dur­ing times when the over­all econ­omy is good.

HUDAK: TIM

to the gov­ern­ment’s in­tro­duc­tion of the Fair Hous­ing Plan, real es­tate prices were ris­ing. The gov­ern­ment launched a cou­ple ini­tia­tives, for in­stance a for­eign buy­ers tax, that had a psy­cho­log­i­cal im­pact and has home­buy­ers on the side­lines watch­ing what’s hap­pen­ing.

But de­spite the de­cline in sales, many Toronto bro­kers I’ve spo­ken with are see­ing a come­back in sales and mul­ti­ple of­fers on prop­er­ties. It would not sur­prise me if Toronto’s mar­ket took a sim­i­lar tra­jec­tory to Van­cou­ver’s af­ter a for­eign buy­ers tax was im­ple­mented there. There were a few months of slower sales, fol­lowed by a re­turn to a ro­bust mar­ket.

The 33 per cent gain re­ported in the spring was un­sus­tain­able and had nowhere to go but de­cline.

GLUCK­STEIN: BRIAN

I think the mar­ket will be steady and pur­chasers will be thought­ful in their buy­ing. There won’t be that same frenzy. I don’t see any ma­jor down­turn this fall.

POST: Why are some pock­ets of Mid­town, such as Casa Loma and For­est Hill, still white-hot while others, such as York Mills and the 905, have ex­pe­ri­enced a no­tice­able sales slump?

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