Toronto’s housing market continued to tighten last month as prices edged up four per cent from March and sales moved closer to the level they were at last April, the Toronto Regional Real Estate Board revealed Wednesday.
Sales for the month hit 7,531, down 5.2 per cent from a year ago but up about nine per cent from March.
Those sales outpaced new listings, which were down by over a third from a year before, fuelling more competition between buyers who were too hesitant to buy homes earlier this year.
Pushing these buyers to the sidelines were eight consecutive interest rate hikes, which took a bite out of their borrowing power, even as prices started to tumble.
Their hesitance and those lower prices weighed on sellers too as many held off listing their homes because they won’t fetch the big sums or bidding wars their neighbours had in 2021 and early 2022.
‘There’s a lot of frustration’
But real estate agents have started to see the market turn in recent months.
“Many buyers have come to terms with higher borrowing costs and are taking advantage of lower selling prices compared to this time last year,” said TRREB president Paul Baron in a statement.
“The issue moving forward will not be the demand for ownership housing, but rather the ability to meet this demand with adequate supply.”
Real estate agent Desmond Brown said the amount of offers homes are receiving can make things frustrating for buyers. (Ivan Arsovski/CBC)
Toronto real estate agent Desmond Brown said there was a window for first-time home buyers to get into the market between December and February.
“That window’s closed,” he said. “We have all kinds of multiple offer situations going on right now. We don’t have the supply for all of them and there’s a lot of frustration.”
New listings down, prices climbed in April
April’s supply level was much lower than the city has seen in the past. New listings for the month totalled 11,364, down 38.3 per cent from a year ago.
The average price was also lower than it was a year ago, tumbling 7.8 per cent to $1,153,269. April’s average price was roughly four per cent higher than the $1,108,499 the average buyer paid in March.
Detached homes fell 8.3 per cent since last April to $1,489,258, while semi-detached properties dropped 9.8 per cent to $1,135,599.
Townhouses slid 3.2 per cent to $986,121 over the same time period and condos were down eight per cent to $724,118.
The year-over-year price of condos is down eight per cent to $724,118. (Patrick Morrell/CBC)
Toronto’s data was released a day after the Real Estate Board of Greater published its April data, which it said showed home sales are staging a comeback and headed toward levels seen last spring.
Last month’s Vancouver-area sales totalled 2,741, almost 16 per cent below the 10-year seasonal average and 16.5 per cent below the April 2022 level.
The composite benchmark price for all residential properties in Metro Vancouver hit $1,170,700 last month, down 7.4 per cent from a year ago but up 2.4 per cent from March.
There were 4,307 new listings last month, a 29.7 per cent decrease, when compared with the prior April and a 22 per cent drop from the 10-year seasonal average of 5,525.
Experts mixed on what comes next
Jason Mercer, the chief market analyst at the TTREB, said he expects demand for home ownership will increase as 2023 goes on.
Firstly, home buyers who were sidelined by Bank of Canada rate hikes are coming to terms with those increases and may be deciding to purchase a different type of home or look in a different area. Secondly, he said there’s a strong regional economy with job creation in a number of different sectors.
James Laird is co-CEO of Ratehub.ca, which provides online mortgage tools among other services. He said although home prices are down year-over-year, they have recently been rising slightly each month.
“So I think it’s fair to assume that the decreases in home prices might be behind us,” he said.
A real estate sign is displayed in front of a house in the Riverdale area of Toronto on Wednesday, September 29, 2021. THE CANADIAN PRESS/Evan Buhler (The Canadian Press)
Laird said prices could stabilize or slightly rise as the spring and summer unfold. That prediction is based on mortgage rate stability, which he said didn’t exist until the Bank of Canada held its rate during the last two announcements.
Tony Stillo, director of economics for Canada at Oxford Economics, thinks the spring pick-up will fade by summer.
“We think the economy nationwide is going to slip into a recession and we think that’s happening during this spring,” Stillo said.
He said prices could bottom out late this year or early next, though he noted it’s tough to predict the exact time.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
