Toronto Market Commentary

The year is coming to an end, but there is no slowing down the Toronto resale market. The record for most sales in the greater Toronto area in any year has already been shattered, and there is still the month of December. The 8,547 sales reported in November took the total year-to-date sales to 107,840, breaking the previous annual record of 101,212 achieved only last year. In all likelihood there should be about 5000 (or slightly more) sales in December. That will bring the year-end total to approximately 113,000 reported residential resales, a truly remarkable feat. Ten years ago, there were only 83,084 reported sales in the greater Toronto area.

This record speaks to the two prominent characteristics of the greater Toronto area market. Firstly, the deep-seated desire for home ownership, and secondly, the rapidly growing population of the area. With approximately 100,000 people immigrating to the Toronto area annually it is very unlikely that much will change in 2017, subject of course to any dramatic increase in mortgage interest rates.

Total annual sales was not the only new record set in November. The average sale price for all sales in the greater Toronto area came in at $776,684. The previous monthly record was set in October at $762,525. It should be noted that monthly average sale price records being set so late in the year is an anomaly. Historically the market reaches its monthly peak in May or June, and thereafter average monthly sale prices begin to decline. For example, in May of last year the average sale price came in at $649,648. That was a record. No month following last May came close to eclipsing that record. A new record wasn’t set until February of this year with an average sale price of $685,738. February’s record has been shattered six times since then, the most recent record being achieved in November. Early data indicates that the Toronto and area marketplace might even establish a new record in December, until recently an unthinkable occurrence.

A third record establish in November was the average days on market that it took properties to sell in the greater Toronto area. It took only 17 days for all properties (on average) to sell. By comparison it took 26 days last year, an accelerated pace of almost 35 percent. In the City of Toronto it took only 15 days for detached homes to sell, and only 11 days for semi-detached properties to be snapped up by buyers.

The average sale price for detached properties in the City of Toronto is now $1,345,962, and for a semi-detached house you must be prepared to pay $906,353. It must be unthinkable to be a buyer who for whatever reason was going to buy a year ago and then did not proceed. That mythical buyer could have bought that same detached house for just over $1,000,000, and that same semi-detached house for approximately $840,000 last year. The percentage change year-over-year is 32 and 20 percent respectively.

As has been set out in previous market reports, the only affordable housing options for buyers are condominium apartments, but even this housing form is becoming pricey. In November, the average sale price for condominium apartments in the central core of the city, where most condominiums are located, came at $526,116. This represents a 13 per cent increase compared to the average price last year. The volume of condominium apartment sales has also increased dramatically. Sales were up by almost 28 percent compared to last year. What is becoming worrisome is the rapidly declining volume of available listings of condominiums apartments. At month end in the City of Toronto there were only 2,002 condominium apartments for sale. When one considers that there were 1,718 condominium apartment sales in the same month, you don’t need to know any form of high mathematics to concluded that we will be out of stock of condominium apartments for sale if this pace of sales continues and it no doubt will, considering that condominium apartments are still (comparatively) affordable. It should be noted that at the other end of the condominium apartment spectrum, 14 condominium apartments sold in November having a sale price that exceeded $2 Million.

The supply shortage is not restricted to condominium apartments, but is impacting the overall marketplace. In November the total number of active listings available to buyers was almost 36 percent less than last year at this time. In actual numbers this amounts to only 8,639 properties, or only 1.2 months of inventory. This will be a hot point affecting the residential resale market in the early months of 2017.

Hiring a Great Assistant

This has to be one of the top issues for Realtors who decide they need help.  And that is the very first “trap”; thinking you need an assistant because you’ve become so busy.  Why is it that a few very successful agents can handle as much business as some who have an admin assistant and a buyer’s assistant?  Some of the answers to this question can be found in last weeks post – The Perfect Week.

Other issues that must be addressed are the question of when do I really need help and how do I go about it.  One of the best things you can do to help with the first question of when, or why, is to do an audit of all the tasks you perform in a week.  Take the same approach as you would doing a food journal if you were trying to tackle a weight loss program.  What you will find after doing this is that the activities will all fall in to one of three areas as described in the post last week:

P = p-time has three ingredients: you, a customer and a contract.

I = i-time you invest creating P-time. Calls, face to face meetings, mailings, notes etc..

E = Everything else.

An assistant should be hired to accomplish “E” and most “I” tasks leaving the agent to focus more time on the “P” time.  There is a second important issue to consider which is to never hire an assistant to do something you DO NOT know how to do.  There are a number of reasons for this but the main one is you will never know how much time it should take and if it is done well.  The other significant outcome of doing your self audit will be a really great focused list of Duties and Responsibilities for your new assistant.

The third “trap” most Realtors fall in to is hiring the first person they run into. Often a past client, friend, or friend of a friend, because they are so “awesome” and “we really get along great” etc. etc.  This is 9.9 times out of 10 a disaster and causes the agent to be even further behind than before.  The other issue with this approach is that the hire has often never worked in real estate and notwithstanding a great resume, nothing can make up for having direct experience in the business itself.

So, what to do.  Using the list of duties and responsibilities, write up a short employment ad.  Ask for resumes to be emailed or at a minimum a job application of sorts.  Go through them and set aside the ones that have promise and do short telephone interviews to further screen the applicants.  By now you might have one clear leader and maybe a few pretty good candidates.  These ones you should interview in person using both direct and situational interview questions.  Don’t preach to them about how great you are.  Let them talk.  Look for the keys to a great admin/support person such as attention to detail, organizational skills, customer service attitude etc..

Here’s one of the really important final tasks to undertake and that is to have the finalist(s) complete a personality profile test like the DISC.  In fact, you should complete one for yourself as well and share it with the eventual hire.  This is a great way to get to know each other’s style and how to effectively communicate.

If you are looking for more information on any of the above, just send me an email and I will happily share more.

 

The Perfect Week

“Stop actually thinking about winning and losing and instead focus on those daily activities that cause success.” Nick Saban

Or, to put this quote another way, work on making small, incremental, consistent changes and the results will show up.   A coach once told me that after 40 years in the real estate business she was still trying to implement time-blocking. So is there such a thing as the perfect week? Brian Buffini talks about winning the day, then the week and so forth.  Perfection may be something that’s out of reach however satisfaction and feeling personal accomplishment are not.

I had a good friend ask about time-management not too long ago and one of the things that I suggested was to stop reading the emails in his in-box the moment he woke up.  The problem with this habit is that we immediately put ourselves on someone else’s schedule and hence never get control of our own.

Ninja Selling teaches students to start their week with the Monday Morning Agenda. In essence this is a personal review or accountability session that sets the stage for the rest of the new week. It’s a review of your business plan, yearly goals, monthly goals, weekly goals and a review of notes from the previous Monday Morning Agenda.  This kind of review allows one to plan out the week for maximum productivity.  In the Ninja Selling world, the weekly routine focuses on communicating with clients, prospects, COI in the morning while leaving the afternoon to conduct buyer and seller consultations, show property, meet with prospects/clients in person, continue building your mailing list. Our time consists of three major factors according to Ninja: P.I.E. Time.

P = p-time has three ingredients: you, a customer and a contract.

I = i-time you invest creating P-time. Calls, face to face meetings, mailings, notes etc..

E = Everything else.

The issue for the majority of us is that our “E” time tends to occupy most of our day. Having reviewed a number of “audits” that realtors have done for me, they are astounded to see how little “I” and “P” time they have in a day.  We can control our “I” time so my suggestion is to go back, review your week every Monday morning and start blocking off “I” time if you want to have a more fulfilling year!