August sales numbers, as reported by the Toronto Real Estate Board, built on the market turnaround in July. Overall sales were up by 21% over sales in August of 2012. For condos, the increase was 18% and for downtown condos, the sales increase over August of last year was 24%. On a year-to-date basis, overall sales are now only 4% lower than in 2012; but as we said last month, it is almost a certainty that sales will now surpass those of 2012! Remember how everyone predicted a sales decline in 2013, except this Market Report!
Looking closer at the downtown condo market, active listings for August were 5% lower than for August of 2012 which suggests that prices are not going down. On the Etobicoke waterfront, condo sales were up by 20% over August of last year and active listings were unchanged from a year ago. This is a sign that even the slowest condo market in Toronto this year is starting to recover.
Sales reported for the first two weeks of September continue the sales rebound. Overall sales are up by 29% over the same period of 2012. And condo sales ran ahead of the overall market for the first time this year, with sales up by 36%. But before the market hysteria sets in, why don't we look at 2011 sales results. Sales for August were only 3% higher than for August of 2011. And sales for the first two weeks of September are trending to only match sales for September 2011.
The point to be made is that monthly sales numbers can be misleading. We need to focus on a longer time frame. A year is a better measure. At the end of the day, most people buy a property to put a roof over their head. The media likes to treat the process as if it is just another investment decision. This is wrong. Because of weather or personal situations, it is easy to postpone the buying and selling process by several months because buying is not time sensitive - unlike groceries or having to go to work. We continue to emphasize that the peak sales year for Toronto was in 2007. With a population increase of over half a million people since then, why would anyone forecast a major sales decline from current levels?
While sales are picking up, prices for condos have remained in a fairly narrow range. To prove our point, we looked at sales at 16 Yonge St., part of the Pinnacle Centre. Located one block north of the Lake and one block south of the Air Canada Centre, it is a new building with a sales history of less than three years. While we did not find the same unit being resold, we did get identical units selling multiple times, which has allowed us to establish a price market and trends. The first unit we looked at was a one bedroom with den and parking. It has two washrooms, a small balcony and measures 684sf. There were seven sales of this unit from April of 2012 to August of 2013. The lowest price was in April of 2012 at $382,000 and the highest was in March of this year at $400,000. The last two sales, both on lower floors were at $390,000. Prices have risen by about 2% annually and the price per sf is $570. The second unit we tracked also had seven sales. This unit is a two bedroom, two bath, with den and parking. It also has a 55 sf balcony and measures 1012 sf. The first sale, on a low floor, was $510,000 in October of 2011. The last sale in 2013 was at $549,000. There were four sales in 2012 with the highest, on a high floor being $560,000. Floor premiums are about $1,000 per floor in this building. This unit type has appreciated by about 5% over 15 months which is an indication that bigger units will perform better going forward. Currently these units are selling at $545 per sf.
August rental activity for the downtown market matched that of July which is surprising. People continue to want to live downtown in ever increasing numbers. Over 40 studio units were leased at an average of $1400 per month - without parking. Just under 600 one bedroom units were leased in August. The entry level for the one bedroom market - no den and no parking - remained at $1600 per month. Expect to pay another $200 per month for either a den or parking. Almost 300 two bedroom units were leased, starting at $2300 per month on average. The most popular type: two bedrooms with parking leases for just under $2400. The two bedroom with den and parking is now at $2700 per month. There are now some three bedroom units on the market, and 14 were leased at an average price of $3700. It is apparent that the rental market for larger units is growing and rents are increasing faster in this segment. We are still experiencing multiple offers on the more popular rental units, even as we hit mid- September.