I promised myself I wouldn’t write this.
I told myself that I didn’t care anymore, and arguing against mainstream media negativity, in the face of evidence to the contrary, was pointless.
And then after a long day, I went home, sat down at midnight, and my fingers started typing…
I don’t like Donald Trump.
I don’t think there are a lot of folks that do.
I think there’s 31% of United States’ population that loves Trump, and most of them also love guns, God, and making either $11,000 per year, or $11,000,000 per year.
I despise everything that he is, and everything that he stands for.
He’s an embarrassment to mankind. Er, “peoplekind,” thank you Justin Trudeau, who I also don’t like, but that’s a topic for another day.
So when I thought about arguing against what the media was putting out, and risking somebody suggest, jokingly or otherwise, that I was referring to “fake news,” that was enough to make me question the post itself.
I hate what Trump has done to supress free speech.
I hate his attempts to undermine those who seek to call him out on his constant stream of organized and intentional lies.
And I hate the words “fake news.”
But from time to time, in the context of real estate, I have been known to point out that there are different ways to “interperet” news, specifically when it comes to statitics.
The Toronto Real Estate Market Is Down 39%
So I paid $1,000,000 for my house, and now it’s worth $610,000? Geez. I might go hang myself.
That number was referring to something else.
Sales Are Down 39% Last Month Compared To Same Period Last Year
That’s something completely different altogether.
I’m growing so tired of the battle for interpretation, and while I understand, “You can make numbers say anything you want,” and I understand that bears and bulls have to co-exist, I have always failed to understand the media’s obsession with providing a false context of the market.
Negativity sells, I know.
And when things were red-hot last year, the stories weren’t about happy buyers – there were reporters camping out in condo open houses to show how “crazy” things were. I would get calls from the media asking, “Do you have any buyers that paid more than they wanted to?” rather than asking me if I had any buyers that paid less than they could afford.
The created-narrative has always been, and always will be, negative.
But at what cost to those that read and believe it?
On Tuesday afternoon, I was standing guard in one of my listings that had become a virtual revolving door, with six showings all booked for 5:00pm, when somebody emailed me the latest National Post article, titled:
“We just got the first real picture of the Toronto housing market — and it’s ugly”
I’m not going to lie – I hadn’t looked at the TREB numbers yet.
So by “Ugly,” I assumed the worst.
Then I read further, saw how the article was written, and what data was being used, and I thought, “Here we go again.”
“Sales plunge 22%, weakest January since 2009,” the sub-heading read. And off-hand, being the stats nerd that I am, I knew this was misleading.
What is the “weakest since 2009?”
The drop in sales?
Sales in October were down 26.7%. Sales in September were down 35.1%. Sales in August were down 34.8%. Sales in July were down 40.4%. Sales in June were down 37.3%.
What the hell is the “weakest since 2009?”
Do they mean the January-over-January drop in sales?
Come on, folks. Talk about trying to create an argument here!
That sub-heading is desperately searching for something that says, “worst in a decade.”
I could just as easily argue, “The 22% drop in sales, January-over-January, pales in comparison to the massive declines we saw in mid-2017, signalling………….a busy year ahead for the Toronto real estate market!”
But I’m not looking to create an argument here. I just want people to know what’s really going on.
Sales in January of the past two years were up 11.8% and 8.2% respectively, so perhaps this is just a “returning to normal,” rather than, as the National Post describes it – UGLY.
And that’s the word I have a problem with, since saying, “…and it’s ugly” merely seeks to fire up those chasing the real estate unicorn – you know, the 70% market correction that will finally get them into that lovely North Toronto detached for $500,000.
Underneath the sub-heading that read “Sales plunge 22%, weakest since 2009,” we’re given this:
The average price of a home sold in Toronto was $736,783, down 4.1 per cent from January 2017, though little changed from December.
That’s how much price is down, year-over year.
And the last time I checked, buyers are only buying one home. I’ve never understood this desire to highlight sales volume, especially instead of price.
This article tells us “sales plunged 22%” in a headline, and only then tells us about the modest 4.1% dip in price, adding “…though little has changed from December.”
Great! So prices aren’t down, and the sky isn’t falling since last month?
The next paragraph starts:
Toronto’s once-hot housing market…
This is where I get really frustrated, and where I told myself, “David, forget it. Who cares about the eternal bears, the people who right the headlines, and the people who believe them.”
But you know what? I can’t!
Folks – the market is hot right now, and it doesn’t help me out at all. I work with buyers, I work with sellers, I’d sell just as much real estate if the market were up, down or sideways. But being as passionate as I am about real estate, and being the realist that I am, I can’t read this crap without calling it out!
I have a listing right now for a property in Forest Hill that is somewhere between land value and a renovation waiting to happen. Since we listed on Monday, through Tuesday night, I’ve had 38 showings booked. It was a goddam free-for-all last night.
“Toronto’s once-hot housing market” we’re told.
I have a client looking for a 1-bedroom condo specifically on Fort York Boulevard – an area I admittedly don’t like. The last six sales have all been over asking, in multiple offers.
Even the damn rental market has multiple offers! I’ve had eight offers on a rental listing, and people are making offers 15% over the list price, with several months of rent up front. The Globe even wrote about it: “Multiple Offers Common Now In Toronto Rental Market”
January started slowly, and for a while, it looked as though the December trend would continue.
But what I’ve seen in the past two weeks has been a game-changer.
The market can move faster than any of us can see, and when it changes, it often happens in an instant.
I can’t quite put my finger on the exact day, but about two weeks ago, properties started to move.
And move, and move, and we’ve been seeing 5-6 offers on 1-bedroom condos, and every freehold under $1M is on fire.
Specifically in those two market segments, we’re almost back to spring of 2017 market conditions. Maybe not March, but definitley January and early-February, right before things went nuts.
Folks, I’m out there, every day, pounding the proverbial pavement. I’m in the so-called “trenches” of the real estate market, and I will always maintain that any busy agent with his finger on the pulse of the market can tell you what’s happening, far better than any newspaper article, and/or hand-selected statistics ever can.
All I see right now is hot, hot, hot.
And perhaps that’s just the 416. Perhaps that’s just the core.
But the narrative out there tells a different story.
Ask any active buyer for a sub-$1M freehold in the core, how their search is going. Show me that buyer, on the front page of a newspaper, gloating about buying a $795,000 property for $730,000, conditional on the sale of their Oshawa townhouse.
I’m just dying to see a story about a couple in Leaside who have had their 3-bed, 2-bath semi-detached home on the market for two months, unsold. But alas, the media can’t spin that story, because it doesn’t exist.
And do they want to write about the absolute gut in High Park that got thirteen offers last night? Nope. Not on your life.
Instead, we’ll look at a 4% drop as though the sky were falling.
And you know what? It’s about to get a lot worse.
The average home price in April of 2017 peaked around $920,000. Just think of what the headlines will read when the average home price from March and April are down double-digits. But those headlines, touting those sexy numbers, will completely ignore what’s actually going on in the market.
Maybe there’s a house in April that sells for $1,000,000, that would have sold for $1,100,000 last year. But this year, priced at $799,900, it still sells for $1M, with nine offers.
Where is that narrative?
Because that’s what I’m getting at here, folks.
The headlines aren’t telling us what it’s like to be a buyer, or seller, today. And buyers need to know what kind of market we’re working in.
Mabye you shouldn’t listen to me, and you shouldn’t listen to the media. Get out there, go to open houses, see what the market is like, and then draw your own conclusions.
Evidence and experience beats spin and rhetoric, ten times out of ten. Whether that rhetoric is bullish or bearish, and whether it’s the media’s, or my own…
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