It took a minute, but it seems that interest rate cuts are beginning to show up in Toronto’s housing market.
The latest figures from the Toronto Regional Real Estate Board (TRREB), released Tuesday morning, show that there were 5,391 home sales recorded over the course of July, marking a 3.3% increase compared to the 5,220 transactions reported in July 2023. This is quite a different story than what we saw last month, when sales ended up some 16% below their year-over-year level.
As was the case in June, most of the transactions were concentrated in the detached home segment, with 2,446 sales recorded (up 3.3% from last year), compared to 1,482 condo apartment sales (down 1%), 939 townhome sales (up 8.3%), and just 471 sales of semi-detached homes (up 7.3%).
Speaking to total sales, TRREB President Jennifer Pearce said that last month's annual uptick was “encouraging to see” and could mark the start of a trend. “We may be starting to see a positive impact from the two Bank of Canada rate cuts announced in June and July,” she said. “Additionally, the cost of borrowing is anticipated to decline further in the coming months. Expect sales to accelerate as buyers benefit from lower monthly mortgage payments.”
While sales were up in July, “buyers continued to benefit from more choice in the GTA marketplace, with annual growth in new listings outstripping that of sales,” TRREB said. “The better-supplied market meant that buyers also benefitted from a slight relief in selling prices on average.”
There were 16,296 new listings recorded in July, representing a 18.5% increase year over year. On a seasonally adjusted basis, however, both sales and new listings observed in July “edged lower” compared to the prior month.
On the price side of things, the MLS® Home Price Index Composite benchmark was down by around 5% year over year last month, while the average selling price clocked in at $1,106,617, which is a slight, 0.9% decline over the July 2023 price of $1,116,950. “On a seasonally adjusted monthly basis, both the MLS® HPI Composite and the average selling price were up slightly compared to June 2024,” TRREB noted.
In the months ahead, buyers are anticipated to tap into more affordable mortgage payments and will benefit from a “substantial build-up” in inventory, said TRREB Chief Market Analyst Jason Mercer. “This will initially keep home prices relatively flat. However, as inventory is absorbed, market conditions will tighten in the absence of a large-scale increase in home completions, ultimately leading to a resumption of price growth.”
