Toronto Real Estate Market- Is there light at the end of the COVID-19 tunnel?

Jeffrey:
In these unprecedented times, I have people asking almost every week, whether it’s a good time to sell or a good time to buy in the Toronto housing market. We’re joined by Patrick Rocca who’s with Bosley real estate. And we’re going to get another view on this. We had a brief chat a few weeks ago during the height of coronavirus. And now it’s about a beginning of June and Patrick is going to take us through some of the changes that he’s seen in just the past few weeks. Patrick, I wonder if you could introduce yourself and tell us a little bit more about what you do.
Patrick Rocca:
Sure. Good morning. Jeff. It’s Patrick Rocca from Bosley real estate. I’m one of the top agents here in the Leaside Davisville market, Midtown area of Toronto. I’ve been doing this for 27 years.
Jeffrey:
Yeah. 27 years is a long time. And it’s safe to say that no one has really seen anything like this, what we’ve seen over the past couple of months, but it’s from the, the heart of Corona virus. We’ve seen some stats that sales were down about 75%, but in more recent weeks we’ve seen them coming back. So have you seen any of this in a, what you do on a day to day basis?
Patrick Rocca:
A hundred percent. Yeah. I mean, as, as doom and gloom, as it was about six weeks ago when we tried it, like, it was literally dead. I mean, it’s like someone just shut the lights off and said, let’s all go home. And we had to go home and say home. And although there was some sales still happening, I think, as we had mentioned in our previous chat it dropped off significantly. I mean, it’s almost the opposite now. You know, six weeks, four weeks later you know, we, we were looking at, you know, sales were down, listings were down like 70 plus percent. Now if you look at just you know, week over week, last week, over the week before, I mean, you know, showings were up 90% offers were up 90% souls were up 95% new MLS listings were up 49%. These are just average distance statistics from a broker Bay. So we’re starting to see the market come back and I noticed it about three weeks ago. I said to my wife, one morning I woke up and I said, I got to get back into a routine and start going to the office and not sitting in my house coat till 11 o’clock in the morning.
Patrick Rocca:
And it was, it was obvious because, and I said that because my phone started ringing the emails started coming in. People wanted to talk about selling and about buying and, and, and whatnot. So there was, it was almost like there was even though COBIT is still going on and there’s still new cases and deaths. And there was almost like some spark that people want to hopefully get back to some sort of life and get back into the market whether it be sale or whether it be purchased.
Jeffrey:
Yeah. And I can imagine a lot of folks were asking, is it the right time? Is it the right time to buy? Is it something where I’m going to get a deal where we haven’t really seen those in the, in the Toronto market? Do you have a lot of folks coming in a lot of buyer interest?
Patrick Rocca:
Yeah. And I mean, I think we were, we started seeing it six weeks ago. I think we had talked about this, that, you know, there’s buyers out there that think that they’re, they’re, you know, they’re like sharks and the, you know, they’ve got, they see the blood and the water and they think that they’re, they’re going to get steals. You know, what the prices are now, there’s no doubt in my market. I’ve seen probably about a 10% drop in that, in that four weeks, six weeks or whatever it was, but you’re starting to see sales again. And are there deals, there’s deals, but are there steals? I don’t see it. Are there still some overprice properties are a hundred percent but we’re starting to come back into, you know, I don’t see, you know, some of the stuff that’s been floating around, out there as like CMHC and some of these people are saying, you know, 20% they’re talking Canada wide.
Patrick Rocca:
I think when you talk, the GTA you’ve talked, you talked neighbors, neighborhood specific. And I, from what I’m seeing, we’re coming back and we’re very strong. I mean, just last week alone Wednesday I was on offers where there were seven offers, Friday eight offers. So stuff is selling. Now I’ll be, you know, that that’s sort of the lower end. You know, under the, you know, the one five range under the 1 million range still very, very active. The, the higher end is still a bit slower, although we’re seeing movement there now, too. So, you know, I think he said a good time to buy. I think so. I mean, who has a crystal ball? I mean, like I read somewhere the other day, someone was saying that their crystal ball is broken. I mean, mine, I don’t have a crystal ball, but what I can tell you is that where I see the market going, I mean, we’ve always been driven by no supply, a ton of demand.
Patrick Rocca:
I think what you’re going to see is maybe a little more supply come on the market. I think that the demand will drop off. Not because people are scared. I mean, maybe there’s a few people that are sitting on the sidelines and think it’s going to go more. But I think you’re going to start to see the repercussions of job loss you know, the, the economic factors that maybe will put people to the sidelines. So I think what we will likely see as a balanced market and we’ll, you know, and that’s healthy. I don’t see us dropping another five, 10%. I don’t know where these numbers are coming from, and it’s just mind boggling some of the stuff I read. You know, you read three different articles and three different publications on the same day, and they all have different facts and figures that they say are accurate, which should just it’s mind boggling.
Patrick Rocca:
What I’m seeing is I think we’re down 10% in my market. I’m starting to see a healthy rebound and we are with, there is some more inventory. There’s no doubt. You know, it’s pulling up the listings, you know, just this morning, actively in the Leaside Davisville market right now. And in in Davisville, we’re at a boat over 30, 33 listings. That’s just, that’s just housing, not taking into account condominiums. And that’s a different story. We can talk about that. Whereas I think this number was closer to 20 six weeks ago and in Leaside we’re 23, and I think that number was closer to 15. So, you know, we’re seeing an increase in inventory, which is a sign that people are starting to get back out there and sell. And so that begs, the other question is, is it a good time to sell?
Patrick Rocca:
I personally think it is. And, you know, I was interviewed in the global mail last Friday. And I basically said if, if you, if you want to sell, if you have to sell do it sooner than later because the concern is, or the, the fear is, is that, you know, we’re, we’re now three months into this six month mortgage deferral program and what’s going to happen in six months when people start paying again and is there going to be a follow-up from that? And are you going to start to see more properties come on the market because of financial constraints that people are having? I’ve already talked to a few people in the last two weeks where they’ve had to sell or they’re, they’re going to have to sell one for financial and other job loss. So, I mean, I would say if you’re selling, do it sooner, you know, sooner than later, I mean, you know, who knows, but I don’t, like I said, my crystal ball is broken, but I can tell you that. I can tell you right now it’s healthy. I mean, I’m saying, you know, I just listed something new yesterday. I have another one coming out next week, two more coming out the week after that. So stuff is starting to happen again.
Jeffrey:
Yeah. And like you said, you know, the crystal ball is broken and I’ve never seen such a divergence of opinion from prognosticators about what the signs say and what they think is going to happen in the market. And I agree with you too, to a large extent, it’s very, very localized and nobody knows what’s going to happen in six months. I know going into this Canadians were carrying a dollar 60 in debt for every dollar of GDP, which is incredibly high. It’s only going to go higher. And the question is, you know, if folks did get in as those 5% mortgages, are they going to be walking when, you know, they can’t make payments in six months, eight months. And so with all that put aside, do you see in the market we’re in right now that buyers and sellers are getting more comfortable with some of the precautions to put in place to do live viewings?
Patrick Rocca:
Yes, I would say yes. So it’s, it’s still tenuous. There is still some nervousness in that market, but we are starting to see it open up for sure. I mean, I just, I just, like I said, I just listed something yesterday. I’ve had like nine showing on it already. So the buyers have come back out and the sellers are, are open with obviously COVID protocols that are in place. And you know, I practice that very, very strictly in terms of, you know, sanitization and, you know, questionnaires that people have to fill out before they go into properties and all that sort of stuff, and, you know, requesting people to wear masks and touch, you know, as little as possible. So yeah, I mean, I, I’m starting to see a bit more of a comfortable there for sure.
Jeffrey:
Yeah. Yeah. And I think that’s even reflected in the overall economy is people are starting to go back into stores, you know, and, and become more comfortable with the protocols. So I think, like you said, it’s, it’s a question of not only the buyers, but the sellers, if you’re in a home you’re selling the home, you’re going to be in that home after prospective buyers walk through, you’ve got to be comfortable with the protocols that have been set up as well.
Patrick Rocca:
Yeah, exactly, exactly.
Jeffrey:
So, you know, I’m, I’m not going to ask for predictions about the future, but it seems that, you know the market is slowly coming back. We’re seeing new listings that are coming on stream. Are there anything that you see in terms of the way that prices are going? Are you still having the same discussions with prospective sellers about, you know, maybe a year ago, two years ago where the prices were and, and where they think they should list now?
Patrick Rocca:
Well, yeah, I am. And, you know, and in some, some sellers understand it and, and, and get it, and then some are still stuck. So I mean, as I said, we’re, we’re, we’re down 10%. I mean, if you look at, I have to laugh at the way the Toronto real estate board is putting a spin on this and saying, prices are actually up a little bit, but they’re comparing to last year. I mean, of course they’re up a little bit compared to last year, but if you really want a true take on the market, you know, compare may or April to the month before, and you’ll look at April when you compare it to March of this year, as opposed to April of 19, we were down GTA 12%, almost like 11.9 or something like that. So that’s the reality and not that makes it tough for, for, for me when I go to do my job and I go to meet with a seller and they say, well, the front real estate board says prices aren’t down.
Patrick Rocca:
They’re not, they don’t compare to last year, but they’re down compared to pre COVID. And when we talked to pre COVID, your price was X, and now it’s not X it’s X minus 10%. And most people are, are, are getting that. They understand it. Some people aren’t and, you know, that’s, that’s the difficult part of my job, but you know, that’s, you know, that’s what I get paid to do is try to explain to people and, and the people that listen are usually very successful. The people that don’t sometimes they’ll language. Right?
Jeffrey:
Yeah. Yeah. And coming back to the properties that you’ve recently listed that have multiple offers, the eight, nine different offers, are there anything about those properties that set them apart from others on the market?
Patrick Rocca:
Specifically knowing that actually it wasn’t my listing. It was my buyer. My colleague Chantel who works with me, did the, the offer. She works with my buyers. So it was, it, it was, it was a great property in in the right price point. So listed just over a million dollars in a, in a great little pocket and ended up selling for over 1,000,003. And it was a starter home. It’s like I said, that stuff, anything under 1,000,005 traditionally sells fairly quickly. If not in multiples. Okay. Not always guaranteed multiples, but it’s selling quick, quicker. Once you start getting over the two, two and a half specifically in our market, they, they tend to sit a little longer, but like I said, you’re starting to see movement there now, too.
Jeffrey:
Yeah. And so putting myself in a seller scenario for the time being are there things that you would advise in terms of differentiating my property, say I’m coming in, in the Lisa Davisville area for let’s just say one five are the things that I should do in this environment now to set myself head and shoulders apart.
Patrick Rocca:
Well, I mean, yeah. I mean, listen, the market’s changed. I mean, the way we do business has changed, there’s no doubt about it. And if, as an agent, if you haven’t adapted specifically in the last six weeks, you’re, you’re going to be lost. You know, open houses are out the window. You’re not allowed anymore. Paper like touchy stuff. I mean, you’re not going to see that as much. I mean, the debate I’m having right now is do I continue on with my newsletter that I send out through the community? Cause our people are people open now to having stuff coming to their house. And a lot of people I’m talking to are actually you know, I’ve talked to a few that they still don’t want any mail like that coming into their house. But it’s, it’s all digital.
Patrick Rocca:
Now. It’s all about the presentation. It’s all about, you know, all my listings. I mean, I was doing virtual tours and professional photography and staging and all that stuff pre COVID anyways, but now it’s, it’s, it’s, it’s, it’s a necessity to even increase that digital footprint and do more three-dimensional tours, you know, Matterport tours. I mean, people want to look at a property as much as they can online before they put themselves in a situation where they have to see it. And if they can, if they can eliminate it or if they can add it to their list by looking online, and you’re still seeing agents that are doing crappy pictures and you’re still seeing, you know, it’s mind boggling, but if you’re not doing the full on floor plans, all that sort of stuff to give the buyer the most information so that they can make a decision to go see your property, you’re not doing your job.
Jeffrey:
And that is really great advice, even in a regular quote unquote market. But I, I agree a hundred percent with the presentation. And like you said, you know, there are so many, very, very savvy buyers out there, especially in that price point where they expect that immersive experience. And like you said, you know, they’re getting it from there, their other, you know, sources of media, why not through the, the homes that they’re, they’re looking at. And like you said, they’re, they’re looking to make that investment in time and they’re going to be very choosy because in this environment, you can’t just say let’s drive around the neighbourhood and see what’s open. A lot of people are saying, you know, if I’m going to go out there and I’m going to put myself in a property, you know, even if there’s safety, precautions, it’s more of a risk than it was a year ago. So I’m going to pick and choose and make sure that this is something that I could see myself putting an offer on before I go out and see it.
Patrick Rocca:
Yeah. A hundred percent. The other thing we’re starting to see a bit more of now in the last couple of weeks, and it has not grabbed me yet. And I have not, I am not a fan of it. Because I haven’t really seen a good one. Are these live open house open houses on Facebook in, in, in, in whatnot. I’m just, I look at, I look at a lot of them and I just find that, you know, for starters, they make me sick to my stomach cause the camera’s bouncing all over the place. And I just don’t feel, I mean that there, I would probably try one. I mean, obviously I’m going to try it. But the ones that I’ve seen, they bounce all over the place. They don’t display the home properly if you’ve got the proper videos and 3 D’s and all that sort of stuff.
Patrick Rocca:
You know, some of these are interactive open houses, so people can ask questions, but I mean, if you’ve got the proper videos and photography and 3d and floor plans, people can write down their questions and call the region or call me. I mean, tthese live open houses, I just find, I honestly, if you could get a chance to take a look at, at one they’re there, I don’t think they sell the property personally, but we’re starting to see them and I may have to try it. And I probably will. I’m probably not that great on camera. I’ve seen some and I’ve just gone. Oh my God. But people are starting to do them and I don’t know how effective it is. Maybe I’ll be proven wrong when I see a good one and I’ll be able to say, okay, I can do that. But you know, I’ve been researching it. I’ve been told that there’s a couple of agents that are doing good ones, but I’m still in the process of exploring that.
Jeffrey:
Yeah, I agree. I think that if you do it well, it can be very immersive, but also inclusive so that people really do feel like they’re having the agent experience, but, you know, from the comfort of their, their living room, dining room or, or their office. So I do agree. I think the devil’s in the details with all this stuff, you can’t just throw a, an iPhone and you know, go around up and down the stairs. Like he said, people will get motion sick, but I think,
Patrick Rocca:
And the way they’re presented mean, like I was listening to what the agent was going on about, Oh, this is the dining room and look at that lovely light fixture. And I’m like, are you kidding me? It just, I dunno to me, I’m, there’s a few that I’ve heard that are very good, that I’m going to take a look at them and see they’re online and see how they were displayed and maybe try one of myself.
Jeffrey:
Yeah, absolutely. And I’d love to try one as well, just to see, you know, what that new method of presenting at houses like you never know in a year, maybe everyone will be doing it and there’ll be the expectation. Yeah, exactly. All right. Well, fantastic to chat again, Patrick, I really appreciate your viewpoint on the market. And if folks want to get ahold of you, what’s the best way for them to do that
Patrick Rocca:
Best way to get hold of me, obviously through my office, there was one other point I did want to touch on. If you don’t mind, just another minute we talked about condos or I mentioned condos a couple of minutes ago and and whatnot, we never talked about that segment of the market and where I see it at right now in specifically the rental market. And this is something that people should be aware of too. The condo market, what you’re seeing right now. And I’m sure you’ve heard this is that there is a glut of condominiums because of Airbnb or no Airbnb. A lot of people bought or Airbnb and now they can Airbnb. So they throw in their condo on the market to lease it on a yearly basis. You’ve seen a flood of these. I think I might’ve mentioned this last time.
Patrick Rocca:
We chatted one building specifically like a hundred in a couple of buildings downtown, a hundred came on at one time in one week what we’re seeing right now in Davisville in that district, there’s over 325 available for under $3,000 a month. In side, last time I checked there was in our district, there was over 125. So the rental market is very, very competitive now and has dropped you know, I, in that goes right across the board. I mean, I leased a house in Leaside in March for 37 50. It did not close due to COVID and I just released it last week for 33 50. So the rental market has taken a hit, there’s more supply the condo market. There’s more going to be more supply. And I think there’s going to be followed up of that as well. Just my opinion.
Jeffrey:
Yeah, definitely
Patrick Rocca:
Getting back to how people can reach me through my office at Bosley real estate (416) 322-8000 and email is always best. Cause my phone is attached to me. mail@PatrickRocca.com.
Jeffrey:
Yeah, that’s great. Thanks again, Patrick. We’ll be sure to put that in the notes below and always look forward to chatting with you. We will definitely do this again in a few weeks and we’ll see where we, what the recovery does look like and what the outlook is like for the summer and fall markets.
Patrick Rocca:
Yeah, I hope so. I look forward to chatting again and then the glass is half full type of guy. So I think we’re, I think we’re heading in the right direction.
Jeffrey:
Yeah, definitely. We have to stay positive.
Patrick Rocca:
Exactly. Exactly.
Jeffrey:
Okay. Thanks a lot. Stay safe. Bye