The GTA’s housing market took an interesting turn in the month of June. Usually spring has strong sales numbers, but not this year. Some analysts are saying the market is correcting itself while others suggest that the drop in sales is simply a psychological response to the government’s fair housing plan.
The next few months of sales numbers will determine which perspective is more accurate but for now, it seems like the GTA real estate gold rush is slowing. Year over year sales have decreased by 37.3%. In response, housing inventory has increased and buyers will now experience fewer bidding wars, if any. Active listings are up 59.6% since last year.
Despite the downturn in sales, it is still a seller’s market. At the same time, selling prices have decreased by 14% since the peak of the market in April. To suggest this is a price crash would be somewhat inaccurate though since year over year prices have still increased by 6.3%.
Herd mentality has a lot to do with markets. The influx of predictions about a real estate bubble burst, and speculation over the effect of the government housing laws have perhaps contributed to an unfounded level of alarm.
Real estate is now becoming an very interesting market to follow. The market developments in the next few months will be a critical for buyers and sellers to understand.