Why Haven’t Prices Dropped?

Compared to April which was the first full month of Covid19 protocols, Toronto’s May 2020 real estate results indicate that buyers and sellers are becoming more comfortable operating in the post pandemic environment. The real estate practices outlined last month still apply but as the weather warms and more businesses re-open, there is cautious optimism.

May 2020 sales increased significantly from April 2020. Meanwhile prices across all types of housing increased compared to May 2019 as new listings declined by 50%.

Market research conducted in April and May by Ipsos during the state of emergency help explain the sales volume and pricing trends we’ve seen since the start of the pandemic.

The following are key findings from the Ipsos poll of buyer and seller intentions for Greater Toronto Area residents:

Buying intentions do not significantly deviate significantly from the norm and are down only slightly.

  • 27% of those polled in April 2020 are likely to buy compared to 31% in Spring 2019

While the most common reason for not buying was being happy with one’s existing home, almost 2 in 10 cite a reason related to Covid19.

By contrast, selling intentions deviate significantly. Most say they’re not likely to sell because they like their current home

  • 17% of those polled in April 2020 are likely to sell compared to 32% in Spring 2019.
  • 2 in 10 cite a factor related to Covid19 for not selling.

Of those planning to sell, 4 in 10 say that they already had plans to sell before the pandemic hit. However, a third say their financial situation has now changed and they must sell as a result.

GTA residents believe that the pandemic will slow down the market. They believe there will be fewer buyers looking for homes and fewer homeowners listing their properties, which will ultimately lead to softer prices.

The last point is noteworthy as prices often reflect expectations leading to self-fulfilled prophesies. So far, prices in April 2020 and May 2020 remained resilient relative to the same period in 2019. What transpires in the real estate market over the next 3-6 months will largely be shaped by the news as polling data indicates pent up demand for housing.

Whether this translates into higher prices depends on whether significant bankruptcies, persistent high unemployment and growing pains in re-opening the economy overshadow the gains made. As we keep a close eye on these developments, stay tuned and stay healthy.

Shen Shoots the Breeze:

Normally, this corner is reserved for light topics: things I’m dabbling in or have discovered that I want to pass along. The tragic deaths of those in the black community: Ahmaud Arbery, Breonna Taylor, George Floyd and Regis Korchinski-Paquet to name the most recent few have been difficult to digest. I am not great with words however there is a time to speak (write) and a time to stay silent. I admit I am afraid of entering into the black lives matter conversation without knowing all the issues and hence possibly unintentionally causing more hurt than good; however I feel that staying silent is wrong and it is more important to call out all forms of racism – both blatant and systemic.

There have been so many poignant articles written by many authors, journalists and those with lived experiences from various media sources, blogs etc… I have been reading much and getting educated on what has and is happening to the black community. As a Chinese-born Canadian, I have privilege that so many do not – not because of intelligence, education, wealth but solely on the colour of my skin. I need to learn the issues facing the marginalized and disenfranchised in our community, how our institutions and individuals perpetuate systemic racism and keep asking ‘how can I be a better neighbour’.

I realize my own contribution to systemic racism can be in the area of helping landlords find tenants. There have been instances where a landlord-client told me that they are not open to a group of people based on perceived stereotypes, ethnicity and skin colour. I felt by not adopting those values in my individual interactions I was not a contributor and since the property did not belong to me and I was not the decision maker, I was not being prejudiced. I realize this was wrong and I need to change. I have committed to the following in hopes of using my voice/actions to break down racism in my small corner:

If I see that a client is being racist, I will commit to having a conversation with them on why this is wrong, and will turn down business opportunities if clients are unwilling to change.

I will endeavour to be more patient with clients and colleagues in the industry if they struggle with communicating in English as would be the case for many new immigrants.

I will commit to using my finances and resources to help causes or organizations in my community committed to fighting injustice and racism.

I will commit to writing to my government representative at the federal, provincial and municipal level where and when appropriate to dismantle systems that contribute to racism.

I will commit to learning more about current issues and events affecting BIPOC so that I will not be ignorant of what is happening within my community.

In the meantime, I am open to hearing from any of you if I’ve overlooked something that I can do to be part of a collective action to irradiate racism in our society. In addition, if you know of any books or movies that have helped you better understand the issues, the lived experiences of BIPOC, please feel free to drop me an email at shen@daveandshen.com

Leave a Reply

Your email address will not be published. Required fields are marked *