It’s hard to believe that we are already two months into 2021 and my baby daughter Ayla is almost 16 months old! We are nearing a year since the pandemic started, but I remain hopeful that this year we will get back to some sense of normality. Last year, when we first learned of the pandemic, I wondered how it would impact the real estate market. After all, in order to sell a home, you have to allow strangers through your home. In April, we experienced a 75% decline in sales as everything seemed to stand still. Most industries were forced to adapt to working from home. The downtown core became a ghost town and the condo market began to experience a major slow down as people began to avoid high density living. The major banks began offering mortgage deferrals and CMHC projected home prices would decrease 6-18%.
However, once the stay-at-home order was lifted the market seemed to bounce back quickly, particularly for freehold properties with backyards. Condos on the other hand were still not as popular. In some instances, prices were down 10-30% from the beginning of the year, and condo inventory continued to climb.
In October I tried to sell one of my own investment properties (a downtown condo). The offer I got was almost $80,000 less than a comparable unit that had sold in early April! I decided not to sell at the discounted price and lease it instead. Boy am I happy I did!
In the past few months, the condo market has done a complete 180. This past month there were more condos sold than ever in the past decade! The window of opportunity to buy has officially closed on the condo market and well, freehold homes as far out as Keswick and Oshawa are now selling for a cool million. Is this type of appreciation sustainable? How could CMHC have been so wrong? Only time will tell. The one thing I know after selling real estate for more than 11 years now is that timing the real estate market is impossible and hindsight is 2020.