Toronto Income Propery Newsletter – February 2014

The downtown Toronto housing market has picked up exactly where it left off a few weeks before Christmas – not enough inventory and sale prices going well in excess of the asking price. Many of you read about the house in the Junction this month that had 32 offers and went for almost $300K over the list price. This is an early indicator of what we can expect this year – fewer houses for sale but prices holding and maybe even still going up. Let’s see if some warmer weather will help stem things for buyers a little.

Interestingly enough, there have been a few duplexes for sale in January, but they all seemed to sell at too high a price to a make a sound financial sense. The buyer for these properties would likely be owner-occupiers as investors will likely be looking elsewhere for more robust returns.

The Winter Olympics start this month so let’s pull for all our athletes to have a great Olympic experience and do us all proud.

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2013 Income Property Sales Data

As far as I know, I am one of the few realtors who tabulate annual sales of duplexes and triplexes in the central Toronto core.  There is no place to go for this information other than pulling the relevant data from the MLS.  Since most duplexes and triplexes are not classified as such on the MLS, we have to search for all the properties that have sold with 2 or more kitchens.  This will bring up houses that have basement apartments in them, but I would like to include these properties since they do have an investment component to them.

Here are some interesting stats for six key Toronto neighbourhoods. (Properties sold with two or more kitchens):

Downtown Toronto (Trinity Bellwoods, Palmerston, Kensington)

• 94 properties sold (over 30 with 3+ kitchens)
• average sale price: $942,508
• overall sales were103% of asking price
• a triplex listed on Manning for $399K (deliberately low priced) traded for $735K

Annex/Casa Loma

• 48 properties sold (mostly homes w basement apartments)
• average sale price: $1,447,206
• overall sales were 100% of asking price
• two income properties on Walmer Rd traded for $100K+ over asking close to the $2M range over the summer

Dovercourt/Junction:

• 88 properties sold (mostly homes w basement apartments)
• average sale price: $613,762
• overall sales were 102% of asking price
• almost 75% of triplexes went over the asking price in this area

Midtown:

• 43 properties sold (mostly homes w basement apartments)
• average sale price: $1,073,402
• overall sales were 100% of asking price
• a five-plex on Briar Hill listed this summer for $1.4M and ultimately traded for $1.8M

The Beaches:

• 36 properties sold (mostly homes w basement apartments)
• average sale price: $845,017
• overall sales were 99% of asking price
• there were only five sales of properties w three or more kitchens all year

Riverdale

• 60 properties sold (mostly homes w basement apartments)
• average sale price: $646,261
• overall sales 102% of asking price
• a duplex near Queen & Pape that needed a complete renovation asking $599K traded for $810K in November

Overall 2013 Sales up by 2%

The Toronto Real Estate Board reported 4,078 residential transactions through the TorontoMLS system in December 2013 – up by almost 14 per cent compared to 3,582 sales reported in December 2012. New listings entered into the TorontoMLS system were down by almost four per cent over the same period.  The total sales for calendar year 2013, at 87,111, were up by approximately two per cent compared to 85,496 transactions in calendar year 2012.

“After a slow start to the year, sales growth accelerated to a brisk pace in the second half of 2013. Despite the inclement weather in December, we finished the year with a respectable gain in transactions compared to 2012. Looking forward, I believe that home ownership in the GTA will remain affordable as borrowing costs stay low. The result could be a further increase in sales in 2014,” said Toronto Real Estate Board President Dianne Usher.

“The average selling price will be up again in 2014 and by more than the rate of inflation. The seller’s market conditions that drove price growth in the second half of 2013 will remain in place in many parts of the GTA. Some neighbourhoods, especially those characterized by low-rise home types like singles, semis and townhomes, will continue to have less than two months of inventory,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.

The average selling price for December 2013 sales was $520,398 – up by 8.9 per cent compared to the average of $477,756 in December 2012.  The average selling price for 2013 as a whole was $523,036, which represented an increase of 5.2 per cent compared to the calendar year 2012 average of $497,130.