It's estimated that the recent outbreak of severe acute respiratory syndrome (SARS) will cost the Canadian economy between $500 million and $1 billion, with most of the impact felt in Toronto where the majority of cases were reported. SARS dominated headlines in the city in April, where as of May 7 there were 264 probable and suspect cases of the disease reported, and 23 SARS-related deaths. There have been no new cases for more than two weeks and officials believe the outbreak has been contained. But in April, news headlines around the world branded Toronto as a SARS hot spot.

In the city, however, life continued pretty much as usual. Schools and businesses stayed open, hockey and baseball games were played, very few people were seen on the street wearing masks, and the hot real estate market made Realtors smile.

The Toronto Real Estate Board reports that it was the second-best April for real estate sales ever. Transactions were up four per cent from March, and average house prices rose to $292,783 from $290,185, an increase of one per cent. The best April ever was last year, and although sales have dropped by 11 per cent from 2002, analysts say it has nothing to do with SARS or with concerns that the city had a real estate bubble that burst.

Ted Tsiakopoulous of Canada Mortgage and Housing Corp. (CMHC) says that while SARS will hurt the tourism industry, "it's unlikely to have a meaningful impact" on the housing market. He says consumer confidence was already down from last year due to the war in Iraq and rising interest rates in Canada, but "sales data is still strong."

Brent Weiner, a senior market analyst at CMHC, says this year's slower market should not be confused with a real estate correction. "Toronto's housing market will continue to benefit from solid fundamentals, which include strong migration, decent job growth and inflation adjusted mortgage rates that remain near historical lows."

CMHC predicts 70,000 MLS sales for the Toronto area in 2003, which would be the second-best year ever. Prices are expected to climb by six per cent over last year.

While buyers ignored the SARS threat, Toronto tourism suffered another setback when the U.S. based Appraisal Institute and the Appraisal Institute of Canada (AIC) cancelled a joint conference, expected to attract 800 delegates, that was scheduled for June 12 to 15. The decision was made after the World Health Organization (WHO) issued an advisory warning visitors to avoid "non-essential" travel to Toronto. The advisory was lifted after six days, but by then the appraisal associations had postponed the conference.

In a joint statement to members, the presidents of the two organizations said, "Our decision was based on our desire to protect the health and well-being of our members and their families traveling to Toronto to attend the conference. Please rest assured that this decision was not made in haste, but was made in recognition of the unpredictable nature of the SARS outbreak, and the health risks associated with travel to Toronto."

Joanne Charlebois, director of communications for AIC in Ottawa, says when the WHO issued the travel advisory, "We felt like the rug had been pulled out from under us, and we had to look at our options."

She says the conference was in the planning stages for more than three years, but when the advisory was issued, the associations felt they had to move quickly to postpone the conference.

"There was a great deal of apprehension," she says. "We had speakers who notified us that they would not be coming, and trade show exhibitors who were nervous about bringing their staff to the city. We had members who told us their employers would not allow them to travel for insurance reasons, or because of internal corporate policies. At that point, we realized that it doesn't matter if you want to go ahead with a conference, there are people who just are not going to attend."

The associations are rescheduling the conference for next summer in Toronto. The Appraisal Institute is moving its annual meeting in June to Chicago, and the AIC is also working out a new date for an annual meeting. Future conferences scheduled for Charlottetown, PEI in 2004 and Edmonton in 2005 are being rescheduled.

In the meantime, Toronto officials convinced the American Library Association to go ahead with its scheduled conference June 19 to 25. The largest convention planned for the city this year, it will see an estimated 22,500 delegates come to give Toronto tourism a badly needed economic boost.

Published: May 8, 2003

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Jim Adair is editor of REM: Canada's Real Estate Magazine, a business publication for real estate agents and brokers. He has been writing about Canadian real estate, home building and renovation issues for more than 30 years. You can contact Jim at .