Toronto home prices rose in September, but sluggish sales and a surge of new listings could be tilting the market back in favour of buyers.
Monthly data released by the Toronto Regional Real Estate Board (TRREB) on Oct. 4 showed the average price was up roughly three per cent month-over-month to $1,119,428 in September. That was also about three per cent higher than the same month a year ago.
At the same time, new listings surged. In September, 16,258 new listings came on the market, a 32 per cent increase from August and 44.1 per cent higher than a year ago.
That left the sales to new listings ratio (SNLR) for September at 28.6 per cent, firmly in buyers’ market territory. The Canadian Real Estate Association (CREA) has said that an SNLR between 40 per cent and 60 per cent is indicative of a balanced market. Below 40 per cent suggests buyers have an advantage, while above 60 per cent points to a sellers’ market.
The SNLR for the Toronto region covered by TRREB had been above 60 per cent as recently as March and April of this year, but has been trending down since then. In August, it stood at approximately 43 per cent, according to calculations based on TRREB data.
TRREB’s chief market analyst, Jason Mercer, suggested buyers might see some increased leverage as a result of the shift.
TRREB president Paul Baron said the market outlooks in the short and medium terms were very different, and that lagging demand should turn around by the middle of next year.
“In the short term, the consensus view is that borrowing costs will remain elevated until mid-2024, after which they will start to trend lower,” Baron said. “This suggests that we should start to see a marked uptick in demand for ownership housing in the second half of next year, as lower rates and record population growth spur an increase in buyers.”
The belief that the Bank of Canada has concluded its rate hikes was echoed in an Oct. 4 report from Toronto-Dominion Bank economist Rishi Sondhi.
In the meantime, the bank’s projection indicates a more significant and prolonged decline in Canadian home sales and average prices than previously anticipated in their June forecast.
“Indeed, both home sales and prices are likely to record declines in the final quarter of this year and the early part of 2024,” Sondhi said in the report. “By 2024 Q1, we expect that sales and prices will have fallen by eight per cent and six per cent, respectively, from their 2023 Q2 levels. These projected pullbacks pale in comparison to the 40 per cent and 20 per cent declines in sales and prices that took place from 2022 Q1 to 2023 Q1 amid aggressive Bank of Canada rate hikes.”
Cameron Forbes, chief operating officer at Remax Realtron Realty Inc. in Thornhill, Ont., said that while an abundance of listings can reduce buyer competition, it doesn’t necessarily lead to large price adjustments or a significant decrease in prices.
But Toronto realtor Cailey Heaps believes the balance has indeed shifted in favour of buyers.
“Buyers definitely have more power than they’ve had in quite some time,” Heaps said. “However, it is dependent on price point and geography because in the market there’s little micro markets and micro economies within the Toronto real estate market.”
TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.
The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.
The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.
“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”
The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.
New listings last month totalled 15,328, up 4.3 per cent from a year earlier.
In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.
The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.
“I thought they’d be up for sure, but not necessarily that much,” said Forbes.
“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”
He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.
“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.
“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”
All property types saw more sales in October compared with a year ago throughout the GTA.
Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.
“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
This report by The Canadian Press was first published Nov. 6, 2024.
The Canadian Press. All rights reserved.
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
The Canadian Press. All rights reserved.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
The Canadian Press. All rights reserved.
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