The chasm between this year’s housing market and last continues to widen, as sales tumble further in the GTA and home prices mark their first year-over-year decline in more than four years.
A total of 5,038 homes traded hands in September, according to the latest data from the Toronto Regional Real Estate Board, a decrease of 44.1%. This is also a 10.4% decline from August’s activity, further depressing prices; the regional average came in at $1,086,762, roughly flat from a monthly perspective, but down -4.3% from September 2021.
This is the first YoY price decrease recorded in the region since May 2018, when a steep lack of supply constrained sale activity. The buffer in annual price growth has steadily narrowed since March, when the Bank of Canada implemented the first of five rate hikes to date, which have materially increased mortgage costs and dampened market demand.
Compared to the market peak noted in February, average prices have lost $247,782, or 18.5%. Sales are down 44.6% from that time period.
The MLS Home Price Index, while still posting gains on a YoY basis, continues to slow month over month, with a 4.3% increase to $1,086,762, compared to the 8.9% uptick recorded in August.
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“Hovering just below $1.1M, the average selling price may have found some support during the last couple months of summer. With new listings down quite substantially year-over-year and well-below historic norms, some home buyers are quite possibly experiencing tighter market conditions in some GTA neighbourhoods. October generally represents the peak of the fall market, so it will be important to see where price trends head over the next month,” said TRREB Chief Market Analyst Jason Mercer.
In the City of Toronto, sales came in at 1,744 transactions, down -48% from last year, dragging the average price by -2.6% to $1,061,876. Deals were down to a lesser extent in the surrounding 905-area markets with 3,294 (-41%), though the price declines were deeper, falling -5.3% YoY to an average of $1,099,938.
Toronto Regional Real Estate Board
By home type, the steepest price declines were seen in the detached segment, falling -10.2% to an average of $1,368,186, with sales down by 40%. In a turnaround from recent months when the cheapest price points were driving the market, GTA condo sales fell -50.5%, though the segment was still the only one to post an annual price gain, up 3.2% to an average of $730,818.
Toronto Regional Real Estate Board
While it’s clear prospective buyers have taken to the sidelines, sellers are also notably trepidatious, as the supply of new listings plunged 16.7% annually to 11,237 -- the lowest number of properties listed in September since 2002. “This is especially troublesome given that the stock of homes in the GTA increased markedly over the last 20 years,” writes TRREB in their report.
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“We must ensure that the temporary dip in housing demand is not allowed to mask the critical shortage of homes available for sale in the GTA,” stated TRREB President Kevin Crigger. “Candidates running in the upcoming Ontario municipal elections must ensure home buyers and renters have adequate housing options in the years to come. Municipal council decisions have a direct impact on housing affordability, in terms of the protracted development approval processes, high development fees and other related policies that preclude timely housing development.”
