Posted on November - 24 - 2010
Toronto Market Steady in October
Sorry, that’s not much of a headline, particularly when you just read in the newspapers that sales were down by 21% in the month of October alone. That’s a disaster. What could be worse than that?
If you just look at October 2010 and compare it to October 2009, then you may come to the conclusion that the sky is falling. In the GTA, last month there were 6,681 sales, that’s a 21% decline from the 8,476 sales in October 2009.
Does it mean anything?
So, let’s have a look at the October numbers over the last 7 years.
Year………..Sales
2004……….6,666 2005……….7,174 2006……….6,876 2007……….7,915 2008……….5,155 2009……….8,476 2010……….6,681
The average number of sales in the month of October is 6,992. That means that this year we would be 311 sales short, which represents a 3.67% decline from the average over the last seven years.
Does anyone really think they should be forecasting either sale prices or the number of sales in an area with millions of homes just based on 311 sales? You have to admit, that’s just pure guesswork. No one is getting an “A” in statistics, let alone a “pass”, for that kind of nonsense. Yet, I do have to agree that it sells newspapers.
Let’s also compare the annual sales figures for the last 7 years from January until the end of October in each year:
Year,,,,,,,,,,Sales
2004……….76,353 2005……….74,809 2006……….74,131 2007……….83,244 2008……….70,197 2009……….76,288 2010……….77,304
The average number of sales over the last 7 years from January to the end of October was 76,047. That means that in 2010, there were 1,257 additional sales which represents a 1.65% increase. Not too bad for a market that is thought to be tanking.
Now, let’s have another look at the numbers over that last 7 years. Only 2007 was higher at 83,244. That means that 2010 had the second highest number of sales for the first 10 months over that measurement period.
So, why all the worry?
Let’s have a look at 2010, month to month:
Month………Sales
Jan……….4,986 Feb……….7,291 Mar……….10,430 Apr……….10,898 May……….9,470 Jun……….8,442 Jul………..6,564 Aug………6,232 Sept……..6,310 Oct……….6,681
What you will notice is that March and April were exceptionally strong months, and May was a good month too. And, if there is a real estate story in 2010 about the market, it should be the strength of the Spring market.
Remember that the common advice in the Spring was:
• Take advantage of low interest rates, and • Beat the HST
There’s really nothing unusual. The consumer just followed the common advice.
You can’t have the sales in March, April and May and then expect them to be there in October too!
The 2010 market is simply performing predictably as it should.
Similar Posts:
- Toronto Sales are UP!
- Home Prices Reverse 8-Month Slide
- Home Sales Show Modest Spring Gain
- Home Sales Show Small Annual Gain
- Investors Boost Existing Home Sales
