In the face of a correction in Toronto’s housing market, sellers aren’t panicking.<\/p>\n
Even with transactions at their lowest level since the 2009 recession, sellers in Canada’s largest city have avoided listing their homes en masse in what could be a sign of confidence the market will come back. According to data released Tuesday by the Canadian Real Estate Association, new listings in Toronto fell 8.6 per cent in April from a month earlier and are down nearly 30 per cent from a year ago.<\/p>\n
The drop has left the sales-to-listings ratio \u2014 a key gauge of a real estate market’s health \u2014 relatively stable in the face of a sharp drop in sales, which may explain why prices in Toronto continue to hold steady. Prices are up 3.1 per cent since the beginning of 2018, even as transactions plunged.<\/p>\n
“The market is actually surprisingly relatively balanced,” said John Pasalis, president of Toronto-based brokerage firm Realosophy Realty Inc. “When you’re comparing yourself to a bubble, sales can fall 40 per cent and inventory can rise and your market is still balanced.”<\/p>\n
It’s still been a rough year for Toronto’s realtors, after federal regulators tightened mortgage qualification rules on Jan. 1 to quell a surge in prices early last year. The market is also facing a new foreign buyers tax and other measures to curb demand.<\/p>\n
Toronto’s real estate market is also coping with a bulk of unsold active listings, a legacy of last year’s surge in prices that prompted people to rush to sell their homes. The sales-to-new-listings ratio, while stabilized, is still at the lower end of the range over the past decade.<\/p>\n
The ratio has averaged 0.46 over the last year, the lowest level since the recession and at the lower-end of what analysts typically consider a balanced market. But at least, it hasn’t been getting any worse.<\/p>\n
Year to date, sales have fallen by a third compared to the start of 2017. New listings are down just 4.7 per cent over the same period.<\/p>\n
“It may be that people are trying to time the bottom of the market,” said Rishi Sondhi, an economist with Toronto-Dominion Bank. “They’re holding out because they think the market is going to turn around.”<\/p>\n