Resale prices were down in February, according to the latest from the Toronto Real Estate Board (TREB). Although the GTA prices fell 12.4% in February year-over-year, average prices were still above 2016’s prices and higher than in January.
The average price for all housing categories was $767,818, compared to $736,783 in January and $875,983 in February last year. Unit sales fell nearly 35% year over year in February. Sales declined 31% in the condo market, although prices were up 10% to an average of $529,782.
TREB says the slowdown is owing to government measures introduced with the Fair Housing Policy; nevertheless, their analyst Jason Mercer predicted we’ll see year-over-year price increases as the spring season comes upon us.
We don’t know what the provincial election this summer will bring, but the optimism that usually follows an election — at least for some — will likely mean a healthy summer. Bear in mind that these figures are region-wide, and many downtown properties are still going above asking with multiple bids.
If you’re thinking of selling and want to be part of what should be a busy spring season, it’s time to get preparations underway. Start digging out all your old paperwork, from appliance warranties to surveys and utility bills, make those little repairs you’ve been putting off, and lay in some boxes for the inevitable decluttering.
Trouble in the condo rental market
The proliferation of home-sharing websites has created a new potential problem for condo investors. CBC reports this week that owner Sanda Jovasevic discovered her tenant had listed her unit on Airbnb, without her knowledge or consent.
Jovasevic was tipped off by the building’s concierge, who alerted her to her unit’s door being left wide open on one occasion, as well as letting her know about noise complaints when two Airbnb clients were in residence, and told her the unit had been listed in their system as an Airbnb property.
She scheduled inspections, but the tenant failed to appear, sending instead a representative of the property management company for which he’d said he worked when the unit was rented. The unit’s closets and fridge were empty, signs that the supposed tenant had not been living in it.
When CBC talked to the owner of the tenant’s supposed property management company, they were told that the tenant was unaffiliated but was an employee of the company’s owner’s gas station.
Policies at the condominium were supportive of short terms rentals, but a lawyer cited by the CBC noted the law was still trying to catch up with short-term rentals, currently a legal grey area. City council in December voted to require licensing for short-term rental operators, due to come into effect later in the year, and limiting homeowners or renters to offering just their primary residences for short-term rental.
The unit, now empty, showed signs of the wear and tear, with broken knobs and stained carpets. Jovasevic said she hadn’t ever met the tenant, but that he had provided a reference letter from the property management company it turns out he didn’t work for.
Thinking of investing in a new condo to generate rental income? The lesson for potential landlords is clearly due diligence.
Meet your potential tenants if you’re not using a reputable property management company. Know what your condo’s laws are, and don’t take shortcuts in the application process. Do background and credit checks, require insurance and a completed application, and require the standard lease agreement including who will live there and any basis for eviction.