Greater Toronto home sales fall amid affordability challenges

Greater Toronto home sales fell 6% last month compared with November 2022 despite an influx in new listings, as high borrowing costs and uncertain economic conditions persisted.

The Toronto Regional Real Estate Board said Tuesday there were 4,236 home sales in the region last month, compared with 4,507 a year earlier. The sales figures for last month were also down 8.7% from the 4,640 in October of this year.

“Not many people are moving,” Toronto realtor Nasma Ali said.

“The only kind of desperation that we’re seeing right now are from people who really need to sell, usually from investors.”

The board said a lack of affordability has taken its toll on the market, which remains sensitive to the current environment of high interest rates, but that relief seems to be on the horizon.

“Bond yields, which underpin fixed-rate mortgages have been trending lower and an increasing number of forecasters are anticipating Bank of Canada rate cuts in the first half of 2024,” TRREB president Paul Baron said in a news release.

“Lower rates will help alleviate affordability issues for existing homeowners and those looking to enter the market.”

The average home price last month was $1,082,179, which was essentially flat compared with November 2022 as the market saw more supply come online.

Across the GTA, sales declined on a yearly basis in all categories except for semi-detached homes, which saw a 6.6% uptick in the number that changed hands.

Ali, the founder of the One Group, part of Real Brokerage, said she’s seen condo sales slow down in particular, especially when compared with the longer term.

“For the past few years, minus a few months during Covid, condos were selling immediately, within one day or within a week,” she said.

“Now they’re just sitting there waiting for any takers and there’s barely any showings. We used to have 100 showings maybe in a week. Now we’re lucky if we have two to three showings a week.”

In the City of Toronto, there were 1,607 sales last month, a 10.2% drop compared with the same time in 2022. Throughout the rest of the GTA, home sales declined 3.2% to 2,629.

Ali said some neighbourhoods are taking a big hit, especially for homes where potential buyers see red flags like nearby construction.

“Buyers have no urgency, because if anything, prices will be maybe down next month,” she said.

“When you look at urban neighbourhoods, like High Park, Roncesvalles, Leslieville, obviously it’s not like what it was at the peak and the price has also come down from the peak.”

Overall, new listings rose 16.5% to 10,545 in November compared with 9,053 during the same month last year.

“Home prices have adjusted from their peak in response to higher borrowing costs,” said TRREB chief market analyst Jason Mercer in a statement.

“As mortgage rates trend lower next year and the population continues to grow at a record pace, expect demand to increase relative to supply. This will eventually lead to renewed growth in home prices.”

Vancouver home sales rise

The Real Estate Board of Greater Vancouver, meanwhile, says home sales ticked up last month as the continued increase of newly listed properties has given prospective homebuyers in the region among the largest selection to choose from since 2021.

The board says November home sales totalled 1,702, a 4.7% increase from the same month last year, though it marked a slowdown from the prior month of October. The total was 33% below the 10-year seasonal average of 2,538 for November.

There were 3,369 new listings of detached, attached and apartment properties last month, a 9.8% increase from a year earlier, as new listings were 2.8% below the 10-year seasonal average.

The composite benchmark home price in November for Metro Vancouver was $1,185,100, a 4.9% increase from November 2022 and a 1% decrease from October 2023.

Andrew Lis, the board’s director of economics and data analytics, says the region has seen balanced market conditions since the summer, which are known to produce flatter price trends.

He says with most economists forecasting mortgage rates to fall modestly in 2024, market conditions for buyers “are arguably the most favourable we’ve seen in some time in our market.”