Although last month brought a tinge of optimism to the Greater Toronto Area home sales front, August saw transactions fall back.
The latest figures from the Toronto Regional Real Estate Board (TRREB), released Thursday morning, show that there were just 4,975 home sales recorded over the course of August, marking a 5.3% decrease over the 5,251 sales reported in August 2023. The month prior, the same year-over-year metric was up 3.3%.
As was the case in June, and then again in July, most of August’s transactions were concentrated in the detached home segment, with 2,218 sales recorded (down 1% from last year), compared to 1,417 condo apartment sales (down 11.4%), 872 townhouse sales (down 6.1%), and 427 sales of semi-detached homes (down 3.4%).
In terms of inventory, TRREB said that the market “remained well-supplied” last month, with 12,547 new listings entered into the MLS® System, representing a slight 1.5% rise year over year. On the price side of things, the MLS® Home Price Index Composite benchmark fell 4.6% in August compared to its year-ago level. Meanwhile, the average selling price slipped by just 0.8% year over year to $1,074,425.
After adjusting for seasonal effects, average selling price, new listings, and total sales edged lower compared to July.
TRREB President Jennifer Pearce explained in a release that first-time buyers remain “especially sensitive to changes in borrowing costs,” but that interest rate cuts from the Bank of Canada are poised to help with affordability (to some degree, anyway). “As mortgage rates continue to trend lower this year and next, we should experience an uptick in first-time buying activity, including in the condo market,” Pearce said.
To a similar tune, TRREB Chief Market Analyst Jason Mercer said that as borrowing costs “trend lower” over the next year and a half, buyers will benefit from lower monthly mortgage payments and lower home prices. “Even as demand picks up, especially in 2025, it will take time for the inventory of listings to be absorbed. Ample choice in the market will help keep price growth moderate, at least in the initial phases of recovery,” he added.
That’s in the near-term. But in the long-run, TRREB CEO John DiMichele warned that the elevated listing inventory we’re seeing today will “ultimately recede.”
“We need to maintain a sustained focus on boosting home construction, especially as it relates to producing the right mix of home types to meet consumers’ needs,” DiMichele said. “This new housing also has to be affordable. Municipalities can help by reducing development charges, which are ultimately passed on to home buyers. If people can't find affordable housing in the GTA or surrounding Greater Golden Horseshoe, they will move elsewhere, and not necessarily to other parts of Ontario or Canada. Housing is a key driver of our region's economic development.”
