Let's catch up on the monthly data:

Over the last 5 years, the average number of condos on the market for sale in October has been 850. This past October, we had only 525 available. Inventory remains very low.

Over the last 5 years, the average number of condos on the market that sold in October has been 404. This past October, we had exactly 404 sales, demand is typical.

The supply vs demand chart showed a significant jump back towards a Seller's market. This is only due to low supply.

The median price of a downtown condo is at all time highs of $683,750.

In October, the average price of a detached home was slightly down from $1,360,623 to $1,323,015. Since January 2017, home prices are down 1.0% while condos are up 48.5%.

Although condo owners have enjoyed an unprecedented run in condo appreciation, it's also created a whole generation of Torontonians who can't afford to buy their first home. Unless their parents can afford to help them with the downpayment and even add their names on the mortgage, home ownership is usually out of reach. Back in 2000, a typical University graduate might start a full time job with a salary of $45k and the median condo price was about $200k. Today, I would argue that starting salaries haven't changed but that same median condo is over $650k. So we have a whole generation between 20-30 yrs old who can't get on the first rung of the property ladder. Why?

Low interest rates and low supply. I argue that mortgage rates around 3% for the past 20 years are a major contributing factor to today's affordability crisis. Low supply is due to many reasons. On the supply side, there are about 18,000 new construction condo units completed each year. On the demand side, Toronto welcomes about 50,000 immigrants each year. The vast majority of new construction is consumed by investors looking to buy and rent their unit or run an Airbnb. Recently we were chatting with a concierge of a very large development (about 1300 units), about 4 years old and he thought about 25% of the building were being used as Airbnb's. New construction usually requires a 15% downpayment and most projects are asking over $1k per sq ft which eliminates a lot of first time Buyers. 

What would help affordability? Discourage investors buying new construction through taxation, abolishing Airbnb's, encouraging more construction by lowering the development fees, approving larger projects, condo corp's charging Airbnb's a monthly premium or banning them, banks charging a higher interest rate for non-primary residence condos... etc. All very controversial and some quite unlikely. More likely is that they'll just continue living at home and that will become the new norm.