Over the past few years, the prospect of buying a home in the GTA seemed impossible for many, with price tags in the millions and intimidating borrowing rates.
That being said, there’s a new sense of ease in the GTA housing market right now as borrowing rates have lowered. For context, last October the Bank of Canada interest rate was 5% and in October 2024 it fell to 3.75%.
According to the Toronto Regional Real Estate Board (TRREB), Greater Toronto Area (GTA) home sales saw a strong increase in year-over-year sales this October. Over the same period, new listings were up, but by a lesser annual rate, and the average selling price was up slightly on an annual basis.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October. The positive affordability picture brought about by lower borrowing costs and relatively flat home prices, prompted this improvement in market activity,” TRREB president Jennifer Pearce said in a statement.
A closer look at GTA real estate in October
So, how exactly did these lower borrowing costs reflect in the GTA housing market? Here’s a closer look:
- Realtors reported 6,658 home sales through the MLS system in October 2024 – up by 44.4% compared to 4,611 sales reported in October 2023.
- New listings entered into the system amounted to 15,328, up by 4.3% year-over-year.
- The MLS Home Price Index Composite benchmark was down by 3.3% year-over year in October 2024.
- The average selling price was up by 1.1% compared to October 2023 to $1,135,215.
- On a seasonally adjusted basis, the average selling price edged up compared to September.
While much of these stats point toward housing affordability, the following statement from TRREB chief market analyst, Jason Mercer, implies potential homebuyers should still be aware of the potential for prices to rise by next year:
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for home buyers. This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
What about condos?
It wasn’t just houses that went up in sales, condos, semi-detached homes and townhomes also made it into the selling limelight in the GTA.
Condo apartment sales went up 33.4% to 1,722, while semi-detached homes saw a 44% increase to 612. Detached home sales rose 46.6% to 3,139. Townhomes saw the biggest sales increase – 56.8% to 1,123.
However, the average sale price was down 1.1% to $920,201. Condo apartments were also down to $694,000. Semi-detached and detached both rose 0.7% to $1,108,376 and 1.2% to $1,462,838, respectively.
A policy to assist affordability
With all this in mind. TRREB also supports the federal Conservative Party’s proposed policy of removing the GST on home sales under $1 million to assist in affordability.
“Given that the average price of a home in less affordable markets such as the GTA and Vancouver is over $1 million, phasing out the rebate between $1 million and $1.5 million, rather than a hard cutoff at $1 million, would address this shortcoming. Provincial consideration should also be given to matching this proposal,” TRREB CEO, John DiMichele, said in a statement.
Sources
1. Toronto Regional Real Estate Board: Sales and Average Selling Price Increases in October (Nov 6, 2024)
This article The calm after the storm? GTA home sales spiked in October as borrowing rates lowered originally appeared on Money.ca
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
