Toronto Housing Market Sees Sales and Prices Decline in August

Toronto home sales fell in August, marking the first decline since early spring, while real estate prices dropped further as competition waned.

 

There were 5,633 transactions last month in the country’s largest real estate market, according to the Toronto Regional Real Estate Board, or TRREB. That was 1.8 per cent lower than July and the first monthly decrease since April. (The numbers were adjusted for seasonal influences.)

 

Activity was nearly 30 per cent below the 10-year average for August, suggesting that real estate is still too expensive for many prospective homeowners, said Jason Mercer, the board’s chief market analyst.

 

“There are still many would-be homebuyers on the sidelines waiting for more relief from an affordability perspective,” said Mr. Mercer.

 

Five-year mortgages are cheaper than last year, but are still more expensive than during the pandemic when interest rates on home loans were below 2 per cent.

 

Buyers also no longer have to compete fiercely for properties in the Toronto region. There are many homes currently listed on the market and more homeowners are putting their properties up for sale.

 

New listings increased by 3.9 per cent to 15,730 in August, giving many buyers the upper hand.

 

“Buyers have taken advantage of this increased choice and negotiated selling prices downward, on average, over the past year,” said Mr. Mercer.

 

The home price index, which removes the highest priced transactions, was $978,100 in August. That was down 0.1 per cent from July and 5 per cent lower than August of last year.

 

The steepest price decline was among condos in the Toronto suburbs, where the average price fell 10.6 per cent to $594,881 compared with August last year. The condo market across the Toronto region has been flooded by new units as developers finish constructing a record number of buildings.

 

Meanwhile, the value of detached houses in the city of Toronto has also declined, with the average price down 10 per cent to $1,524,066 over the past year.

 

Since late 2022, activity has been mostly slow. Even though borrowing costs have come down, Mr. Mercer said the uncertainty wrought by the U.S. trade war is likely weighing on buyers.

 

Resolving trade problems with the U.S. and the impact of tariffs could boost buyer confidence, he said.

 

 

 

 

This article was first reported by The Globe and Mail