Tamir: It is Time to Purchase

The Toronto Real Estate Board (TREB) recently published its report on monthly resale housing figures. The report clearly shows a trend change in the real estate market. During the month of June, 8,442 sales were reported through MLS, a statistic which reflects a 23 per cent decrease compared to the record 10,955 sales which were reported in June of 2009. Sales for the second quarter of 2010 were 28,810. Year-to-date sales through June were 50,455, up 23 per cent compared to the first six months of 2009.

The average price of homes for June was $435,034, an eight per cent increase compare compared to the average of $403,972 recorded for June 2009 ($403,972). TREB President Bill Johnston said in the report: “We experienced a record number of existing home sales during the first half of 2010, but these sales were weighted more towards the beginning of the year. The pace of home sales has moderated from record levels over the past two months with the prospect of higher mortgage rates.”

Veteran Thornhill real estate agent Erez Tamir (of Re/Max) said in an interview with Shalom Life that the TREB statistics also reflect the situation in Thornhill. The “panic for homes” that was prevalent at the beginning of the year ended in May and we are now witnesses to a calmer market, greater hesitancy of purchasers, and a gradual adaptation of sellers to the new reality. Many individuals who had hoped to presently receive the high level of prices that was prevalent at the beginning of the year are unable to sell their homes and they leave the market. Others lower the price, sometimes by tens of thousands of dollars, which causes good opportunities for purchasers.

“It is the buyers’ time,” said Tamir and brought some prominent examples to illustrate his words from a close and systematic observation of the developments in the Thornhill real estate market. A large four bedroom house facing the forest in Central Thornhill Woods was sold for $792,000. The house was placed for sale at $839,000 and the sellers had to reduce the price by 6 per cent. This is not the only such case. Another private house in Thornhill Woods was sold for $658,000 after a reduction of $17,000 in the original price. In another case, the seller took the price down by $18,000 on a house that was eventually sold for $660,000. A prestigious private home in Thornhill, for which the sellers demanded $820,000, was sold at just $790,000, which is $30,000 less than the requested price. A similar situation exists in townhomes: A townhouse in Thornhill Woods was sold for $465,000, $20,000 lower than the original requested price, and another townhouse was sold at $450,000, $18,000 less than the requested price. A townhouse in Central Thornhill has been on sale for several months at a price higher than market value and has yet to be sold. The sellers have reduced the price by $10,000 in hopes of finding a buyer. Another townhouse in the same area, near a main street, was taken off the market due to lack of interest by buyers.

The drop in market prices is also being felt in condominiums. A two bedroom apartment on Maison Parc (Dufferin and Steeles) was sold for $389,000 after the sellers dropped the requested price by $10,000. A two bedroom apartment in the same project was sold for $298,000 after a drop of $1,000 in the price. A two and a half bedroom apartment in one of the old buildings at the Promenade was sold for $350,000, a price $7,000 lower than the requested price. A two bedroom apartment in the same area was sold for $318,000 after a price drop of $11,000. A one and a half bedroom adjacent to Wal Mart was sold for $293,000, at a price lower by $2,000 than requested. Tamir emphasized in this regard that this is data from the month of June, and that this trend was further sharpened during July. He said that despite the temptation of new buildings, many clients actually prefer the older apartments because of the differences in apartment sizes, which can be significant for families with children or for someone who requires an additional half room for the purpose of a study room.