Photo: James Bombales

Data released earlier this month by the Toronto Regional Real Estate Board (TRREB) gave us the first glimpse of the huge blow the COVID-19 pandemic would deliver to the city’s housing market.

After a strong showing in the first half of March, Toronto home sales fell 16 percent in the second half of the month when compared to the same period in 2019. While the market still emerged from March with sales up 12 percent over the previous year, it was a far cry from the momentum achieved in February when sales rose 44 percent over 2019.

“Uncertainty surrounding the outbreak’s impact on the broader economy and the onset of the necessary social distancing measures resulted in the decline in sales since March 15,” said TRREB President Michael Collins, in a media release.

There’s no doubt that market activity will fall much further and April’s results will paint an even bleaker picture of the state of Toronto housing after a full month spent weighed down by the pandemic.

But as market activity takes a big hit from the restrictive measures implemented to fight the virus’s spread, RBC Senior Economist Robert Hogue believes that Toronto home prices are relatively safe from a significant decline.

In a brief published in response to last month’s TRREB data, Hogue noted that the MLS price index for Toronto still increased 11.1 percent year-over-year in March.

“We expect price support to wear down in the weeks ahead. Still we see a low risk of a collapse at this point,” he said.

“We believe the extraordinary policy response from all levels of government and the Bank of Canada, as well as accommodating measures offered by financial institutions will soften the blow.”

TRREB’s own market analysis team took a similar view when providing a preliminary evaluation of the disruptive effects of the pandemic on the region’s housing market.

“As we move through the spring, it is possible that we may see a moderation in price growth if market conditions soften due to a combination of slower sales and an uptick in listings,” TRREB said in a media release accompanying the March market data.

“However, a resumption of tighter market conditions and an improving pace of price growth will likely occur as the market recovers in the fall of 2020 and winter of 2021.”

TRREB is set to release an updated Toronto housing market outlook for 2020 in mid-April once it completes a full assessment of the impacts of the pandemic.