New home sales across the Greater Toronto Area (GTA) have improved over the lows seen throughout the latter half of 2022, but remained muted in November as whispers of springtime interest rate cuts lulled buyers into hibernation.

According to a new report from the Building Industry and Land Development Association (BILD), 1,694 new homes were sold across the GTA in November, relatively "flat" compared to October and marking a 13% annual increase.

Despite the jump from last year’s significant slowdown, the figure, which is courtesy of data from Altus Group, remains 54% below the 10-year average.

Condominium apartments, including units in low, medium, and high-rise buildings, stacked townhouses, and loft units, accounted for the majority of homes sold in November, with 1,310 units changing hands. The figure has inched up 7% year over year, but sits 51% below the 10-year average.

On an annual basis, single-family homes fared better, with sales rising 41% from November 2022. The 384 homes, which include detached, linked, and semi-detached houses, as well as townhouses, again remains 62% below the 10-year average for the measure.

“This slow pace of sales is entirely due to current interest rates,” said Justin Sherwood, SVP Communications and Stakeholder Relations at BILD.

“We are at a pivotal time in the market. The GTA population is expanding and we need housing, but slower sales today will lead to slower housing starts in the immediate future, which will hamper new supply coming to market.”

As sales slowed, total new home remaining inventory shrank to 20,706 units, more than 17,000 of which were condo units. This brought total combined inventory levels up to nine months for the first time since December 2015, putting the GTA “on the cusp of a balanced market.”

However, with total inventory declining on a monthly basis, Sherwood noted the balanced market is merely a façade brought on by slowing sales, and does not represent more homes coming to market.

Amidst slowing sales, benchmark prices for new single-family homes fell to $1,594,036, an 8.5% annual decline, while prices for new condo apartments dipped 7.3% year over year to $1,040,295.

“We cannot be lulled into a false sense of security because when rates moderate and sales pick up we will be right back into a supply crunch,” Sherwood warned.