Tightening affordability forced many Toronto and Greater Toronto Area homebuyers to put their real estate plans on pause in October. Although now that the Bank of Canada announced that it would hold the overnight lending rate at 5%, some of those cautious buyers might re-enter the market in the coming months. According to the Toronto Regional Real Estate Board, year-over-year sales activity was down by 5.8% but month-over-month sales remained stable increasing by 0.1% from September.
“Record population growth and a relatively resilient GTA economy have kept the overall demand for housing strong. However, more of that demand has been pointed at the rental market, as high borrowing costs and uncertainty on the direction of interest rates has seen many would-be home buyers remain on the sidelines in the short term. When mortgage rates start trending lower, home sales will pick up quickly,” said TRREB President Paul Baron.
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Demand Still Solid in Some Markets Despite Sales and Prices Softening in Most Regions
All property types besides condos experienced an increase in year-over-year price, with detached homes increasing the most by 6.1% to $1,450,112. The average price of a condo apartment fell by 1.2% year-over-year to $708,780, but Durham Region and Halton Region both experienced a month-over-month increase of 12.8% and 4.2% respectively.
The average home price for the Toronto Region in October was $1,125,928 – just a 0.6% increase from the previous month and a 3.5% increase from last year, indicating demand has not fallen off for motivated buyers. Month-over-month sales increased in Mississauga, Milton, the City of Toronto, and York Region. Detached sales also increased month-over-month in those areas by 25%, 6%, 6.7%, and 8.9% respectively.
However, in general sales and prices were on a downward trend in October. Home sales dropped month-over-month by more than 10% in Oakville, Halton Hills, and Brampton, and by 7.4% in Burlington. With competition cooling down in many cities, this provides an opportunity for buyers to snag homes at more affordable price points. The average price for a condo in York Region dropped to under $700,000 for the first time since April 2023 and in Oakville, the average price of a home dropped month-over-month by 10%. Brampton also benefitted from softening prices, with the average price of a detached home decreasing month-over-month by 5.4% and the average price of a condo by 4.2%.
Inventory Gains Slowing Down
Though new listings were down month-over-month by 11.5% in Toronto Region, active listings were up by 3.3%. Months of inventory also increased from 2.2 months in September to 2.4 months in October.
Locally, it was more of a mixed bag with some areas, like Oakville and Brampton, experiencing a month-over-month drop in both active listings and new listings. New listings in the City of Toronto fell by 13% month-over-month, while active listings were up month-over-month by 4.3%. Burlington and Halton Hills experienced significant gains in active listings, increasing month-over-month by 11.7% and 6.9% respectively.
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