Waiting for Houses

If you’ve looked for a house in central Toronto during the past twenty years, you probably have a pretty good idea of what it means to wait for a house. For most buyers, the process goes something like this:

You toy with the idea of moving for a few months or even a few years. Then you wake up one day and say “Yup. It’s time to move. Let’s get out there and find ourselves a new home.” (Whether you say this with a western movie accent is up to you.) You figure that because you’re now ready to buy, there’ll be a whole slew of homes for you to see, one of which will certainly be your dream home. You call your Realtor, start the search, are surprised by how few homes are on the market, but figure one of them will be THE ONE. You look at the homes that are listed and none of them fit the bill. Not even close. So you wait. More homes come on the market. Some are close, but most aren’t. So you wait. Finally, a home appears that you like enough to bid on. But five other buyers feel the same way. So you make your best offer, but it’s not good enough and another buyer gets the home. You go back to waiting for more homes to come on the market. Eventually, you find another home you really like, you make an offer and you get it. It might take a few months or it might take a few years depending on how particular and lucky you are.  Finding a new home in today’s market can be frustrating to say the least.

Because of the waiting, one of the questions we hear quite often is “When are all the homes going to come on the market?” Depends on how you define “all the homes”. There are rarely a lot of homes on the market at the same time in central Toronto, unless you think five homes in the same price range offering similar features is a lot of homes. That’s just the way it is. The number of homes in central Toronto is fixed. They’re not making more land. The number of buyers keeps increasing. Homes come on the market and usually sell relatively quickly. It’s a simple matter of supply and demand.

What to do? Well, if you want to give yourself the best chance of finding a home, you should probably look when the largest number of homes comes on the market. We’ve done deals on Christmas Eve and in the dog days of summer when there were hardly any homes coming on the market at all, but your odds will naturally improve if you’re looking when there are more homes coming on the market.

Luckily, the market in central Toronto tends to follow certain patterns. Check out the chart to get an idea of what happens in a typical year. April, May and June (the spring market) are the months with the largest numbers of homes coming on the market. If you’re buying, this is when you’ll likely have the greatest selection of homes from which to choose. But keep your expectations realistic. There probably won’t ever be more than a handful of homes to see. This is also a good time to sell because the highest average price of the year usually occurs in one of these months. You’d think that the increase in supply would have the effect of softening prices, but the increase in buyers (demand) is usually larger than the increase in homes for sale (supply) so prices rise.

  # of New Listings Average Price
Aug ‘17 1,740 $798,797
Sep ‘17 2,625 $906,357
Oct ‘17 2,418 $901,180
Nov ‘17 2,332 $910,508
Dec ‘17 994 $827,033
Jan ‘18 1,419 $857,361
Feb ‘18 1,748 $892,378
Mar ‘18 2,217 $883,297
Apr ‘18 2,611 $949,084
May ‘18 3,189 $960,558
Jun ‘18 2,552 $966,088
Jul ‘18 2,215 $931,472
Aug ‘18 1,843 $888,683
Sep ‘18 2,652 $963,448

The fall market of September and October is usually the second best market in which to buy as you can see from the large number of new homes coming on the market during those months. It’s also a good time to sell as evidenced by the high average sale price. But it’s not as good as the spring market.

If you don’t manage to find what you want during the spring market, don’t give up hope. Even though the number of new listings decreases significantly during the summer months of July and August, you should keep looking. You don’t need 100 new listings to find your dream home. You just need one and there are often good deals to be had in the summer. There will be less competition because many buyers take the summer off. And sellers who choose to sell during the summer are often highly motivated because, if they didn’t need to sell, they’d wait for the fall or spring to take advantage of the typically higher prices. Being ready to move quickly in the summer could save you a lot of money.

The number of homes coming on the market is also lower during the months of November (as people start preparing for the holidays), December (as people celebrate the holidays) and January and February (as people go on holiday or spend more time indoors during these cold months). Prices tend to be lower during these months, just as they are in the summer months. Also similar to the summer months, being ready to move quickly might result in a good buy during these months.

Knowing what to expect will improve your odds of finding the right home, but remember that people buy and sell homes every day of the year. If you’re serious about finding a new home, you have to be ready at all times. That doesn’t mean staring at your phone 24/7, but it does mean getting your financing in order and doing your homework to know what your dream home looks like and will cost so when it appears you’ll be ready to pounce.

As always, I’d be happy to talk to you about your options if you’re thinking of buying or selling in the near future. Also, if you know anyone who is interested in learning how the market works and would like to receive the kind of help that involves honest answers, straightforward advice, no pressure and being treated like family, please let me know the best way for me to connect with them because I’d like to offer them this kind of help. And as always, don’t be shy if you have any questions or comments about this post! Thanks for reading.

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