Even though Greater Toronto Area (GTA) home sales and new listings went down drastically in May, competition remained at similar levels as the same time last year.
A recent report by Zoocasa calculated sales-to-new-listings ratio (SNLR) for 20 major real estate markets across Canada, and found that 40% to 60% indicated that demand and supply were balanced during the period covered.
When looking at the GTA homes sales dropped by 54% year-over-year to 4,606, and new listings declined 53% with 9,104 homes being listed.
Given the near-identical rate of decline in sales and new listings, buyers and sellers that were active in the market during May experienced similar levels of competition as those last year.
This can be shown with the SNLR for the GTA in May 2020 was 51% compared to the 52% of the same period last year.
Of the 20 markets studied, eight markets exhibited an SNLR lower than the national average, meaning competition conditions in these markets slightly favoured home buyers compared to the national average — the GTA came in eighth place.
However, of these eight markets, just two could be categorized as “buyers’ markets”, while the rest remain in “balanced market” territory.
In Edmonton, Alberta, sales dropped 40% year-over-year and new listings declined 21%, resulting in an SNLR of 38%. This figure represents a departure from conditions last May, when the Edmonton housing market was “comfortably balanced” at 49%.
Similarly, the SNLR in Fraser Valley, BC, dropped from 44% last year to 38% this year, signifying a similar shift from balanced to buyer’s market conditions in that region.
According to the report, as COVID-19 restrictions ease in some regions and market activity slowly ramps up, it may be helpful for homebuyers to get a read on how competitive housing activity is in their area.
For example, in regions where sales and new listings declined at a similar pace, buyers may find that despite substantially lower sales and inventory, the housing market may feel just as competitive as last year.