Toronto Real Estate Market Report

Home sales were up in January 2024 in comparison to January 2023. This annual increase came as some homebuyers started to benefit from lower fixed rate mortgage rates. New listings were also up year-over-year, but by a smaller amount than sales. The resulting tighter market conditions points toward possible price growth as we move into the spring market.

We had a positive start to 2024. The BoC expects inflation to decrease, which would support lower interest rates and thus bolster home buyer confidence. Lower mortgage rates will make the move to homeownership more affordable.

The 4,223 sales in January 2024 was an increase of more than one-third compared to January 2023. The number of new listings was also up year-over-year, but only by 6%. On a month-over-month seasonally adjusted basis, both sales and new listings were up.

For now, last month’s average selling price was down by 1% year-over-year to $1,026,703.

Once the BoC starts cutting the overnight rate (hopefully starting in Q2), expect home sales to pick up even further. There will be more competition between buyers in 2024 as demand picks up and the supply of listings remains constrained. The end result will be upward pressure on selling prices.

The housing market is expected to improve with lower borrowing costs, there are still a number of policy issues that need to be addressed. At the federal level, the OSFI should be examining the mortgage stress test, especially in cases of renewal. The Province needs to remain focused on building 1.5m new homes. Helping first-time homebuyers get into the ownership market will ease movement across the entire spectrum and relieve pressure on the rental market.