The October stats for Toronto suggested a drop of 35% in number of sales and a whopping 10%+ drop in prices compared to last October.
It just didn’t feel right.
The volume drop wasn’t a big stretch – people are being cautious and last October was a world-beater.
But we weren’t seeing that kind of price drops as yet. So Gord gave himself a headache trying to weed through the numbers for a little more info.
Sure enough, the percentage of homes in the high price ranges dropped significantly. About 25% of homes sold in October 2008 were over $400,000, right up to the $2million and higher mark. Same time last year over 30% of homes were up there.
By one rough calculation (quite a few assumptions in the absence of detailed data), the average price drop would have been about 3% rather than the reported 10-13% if the distribution of home prices had been the same.
Proportionately fewer million-dollar homes on the market selling for less money can have a distorting effect on the overall averages.
So, stuff is going on and a lot of it isn't very good. But the risk of "falling sky" is much less where most of us are standing than what the headlines often suggest.