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[Infographic] 5 Year GTA Breakdown – The Best Time to Buy and Sell Your Home

In Canada by TheRedPin Team10 Comments

View full infographic here

Last year, we put together an infographic that revealed the best time to buy and sell your home. This year we took it a step further by conducting a 5 year GTA analysis. The Toronto housing market today is a totally different beast than it was five years ago. While in 2010, the average price of a GTA real estate transaction rarely broke the mid $400,000’s, fast forward to now and the numbers have jumped by a staggering 30 percent!

Despite the colossal price spikes and market shifts over the past half-decade, one trend has remained true and consistent – January has proven to be the least expensive month of the year to buy a home. Not just in 2014 but in every year since 2010.

While typical real estate trends tell us that spring and summer are the best times to buy a home because of the overwhelming number of homes for sale during that time, the data tells a different story when looking at prices.

By pulling data from the Toronto Real Estate Board (TREB), we calculated the average price for all housing types since 2010.

Here’s what we found

Prices in January over the past five years was $461,761nearly $16,000 less than the next least expensive month* and $60,000 lower than the highest month.

Applying the same logic, the month of May was found to be the most expensive month to buy a home, which is great news for sellers looking to sell their property for a ‘fair’ price.

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Average Price: Best time to buy and sell

Why are prices lower in January?
· Between the notoriously cold Canadian weather and the post-holiday slowdown, fewer people are out actively house hunting in January. With fewer buyers on the market, competition dips, as do prices.

· As homeowners are putting their properties on the market in January rather than waiting till the peak spring and summer seasons, it’s fair to assume they are more motivated to sell, resulting in lower prices and more room to negotiate the best price.

Why are prices higher in May?
· In comparison, May is the most active month for house hunters. Thanks to the pleasant summer weather, everything from viewing open houses to moving are all made easier in sunny weather conditions. Plus, families looking to move often chose to shift homes when the kids are off from schools during the summer holidays. This all translates to more buyers and therefore, higher prices and competition.

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Days on Market: Best time to buy and sell

January:
The longer a house spends on the market, the more motivated an owner is to sell their property. With higher days on market, house hunters have more leverage to negotiate and bring the price down.

With fewer active homebuyers in winter, the average days on market in January for the past five years was 34 days.

May:
The average days on market in the spring and summer months hover around the low 20s, meaning one thing, buyers are snatching up homes left, right and centre – which is ideal for homeowners looking to sell their home.

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Listings: Best time to buy and sell

January:
The typical holiday season slowdown means fewer homeowners put their properties up for sale in January. With a dip in the number of new listings, buyers have a smaller pool of homes to choose from.

While this may seem like a drawback at first, it can actually work in your favour. You won’t be overwhelmed by a number of houses up for sale, instead, you’ll only be dealing with the most motivated sellers and the most affordable homes on sale.

May:
More properties are listed on the market in May than any other time of the year. Homeowners looking to sell should see this as a sign that real estate has hit its most active season, and buyers are out in full swing, ready to purchase a home.

For sellers, this is the time to be creative and set your home apart from the competition.

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Difference between housing types:

When we delved deeper and look at the best time to buy and sell for each housing type, separately, none of the home types seem to fall within January or May. We speculate this is largely due to the constant shift in the number of new listings each year, which impacts overall average prices and trends.

Comments

    1. TheRedPin

      You’re welcome Terry. We hope it gives you a unique insight into the Toronto housing market.

  1. Jo No

    How can the best time to sell, for all 4 housing types individually, be either October or November, and yet the best time to sell for all 4 housing types collectively be May?

    1. TheRedPin

      Hi Jo,

      You bring up a great point.

      For our analysis, we wanted to give our readers an overlook of the housing market, and for all home types, May is collectively ranked as the best time to list.

      Why detached homes or townhouses did not each individually fall within May is a question of averages.

      For one, with the larger supply of homes on the market during May, some high priced homes could have slightly driven up the average. Hence landing May the number one spot.

      Moreover, while detached homes sold highest in October, May could have come in a close second. When grouping and averaging all the home types together across the five years, its May that collectively come out on top.

  2. Riksbits

    hmmmm,you are looking at domestic issues here. Not to forget what the interest rates are in jan & may. The mood of the investor is not only determined by internal factors but also external

    1. TheRedPin

      Hi,

      You are correct. We are largely looking at this story from a domestic angle for local buyers. Of course, there are plenty of factors that come into play, aside from price, that highlight when or why you should buy or sell. Price and days on market however, are often the two most poignant facts when it comes to a real estate transaction, and you can’t deny, the gap in May and January are noteworthy. It’s also important to note, the study spans a period of 5 years, so the trend has reigned true for a significant period of time.

      Thank you for your feedback and if you’d like to discuss the matter more, please feel free to call us at 416.800.0812 and one of our insider salary based sales representatives would love to explore the topic further.

      We also delve deeper into why May is a better time to sell here: https://www.theredpin.com/blog/when-is-the-best-time-to-sell-a-house-in-toronto/

      Best,

      TheRedPin

  3. Riksbits

    Your are looking at convenience factor more then financial aspect.

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