Nearly 80% of houses sold in Toronto last month went for over asking

Global pandemic, months-long business closures, economic collapse? The Toronto real estate market hasn't heard of them, if recent sales numbers are any indication.

Yes, home prices and transaction volumes keep on skyrocketing in the city despite the fact that immigration is down and many people are in a more financially precarious position than ever, with the average cost of a home of any type now over $1 million in the GTA, and just shy of $1 million in Toronto proper.

And, new data from February shows that the market has become so competitive in and around the city that people are happy to pay more than the asking price in more cases than not in order to secure the home they want.

A shocking 79 per cent of those who bought a townhouse, detached or semi-detached home in the Toronto area last month paid over asking — a huge jump from the 50 per cent that sold over asking in December — according to the latest report from industry expert John Pasalis at Move Smartly.

Sales numbers for these housing types were likewise up, with a a whopping 46 per cent more houses sold last month than February 2020.

The history of houses selling over asking in the Toronto area. Graph from Move Smartly/Realosophy.

When it came to condos, sales numbers spiked even higher at 52 per cent more last month compared to February of last year, but the number of units that ended up going for over asking was just shy of half, at 48 per cent.

Still, these stats are pretty drastic given that being able to sell a home for more than the asking price is an owner's and agent's dream, not at all an expectation or a norm.

The figures could be a result of homes not being priced appropriately, but are also attributed to the age-old problem of high demand coupled with dwindling supply.

That wasn't a problem in the condo market at one point during the health crisis due to the fact that people were trying to sell off their short-term and long-term rental properties as travel was down, rent prices plummeted and many moved out of the city.

Would-be homeowners then started cluing in to the bargains to be had in the condo market, which has now caused that sector to quickly heat up again.

Months of inventory, which is a tool realtors use to gauge how bonkers a market is, has also fallen dramatically for all housing types in the GTA, meaning that competition between prospective buyers is only bound to get more fierce and prices climb even higher, especially as things start opening up again.