Toronto Real Estate Market Report

The impact of high borrowing costs, high inflation, uncertainty surrounding future Bank of Canada decisions and slower economic growth continued to weigh on Greater Toronto Area home sales in September. However, even with fewer sales and more listings, average selling price was up.

The short and medium-term outlooks for the GTA housing market are very different. In the short term, the consensus view is that borrowing costs will remain high until mid-2024, after which they should start to trend lower. Thus, we may start to see a marked uptick in demand in the second half of next year, as lower rates and record population growth spur an increase in buyers.

Realtors reported 4,642 home sales last month – down 7.1% compared to September 2022. The year-over-year dip in sales was more pronounced for semis and townhouses. Condos sales are not cratering, as many seem to think. On a month-over-month seasonally-adjusted basis, sales were also down slightly.

New listings were up strongly on a year-over-year basis from the abnormally low level in September 2022. The number of listings also trended upward on a month-over-month seasonally adjusted basis.

The MLS Home Price Indexwas up by 2.4% year-over-year, while the average price was up by 3%. GTA home prices remain above the lows early in the first quarter of 2023. However, we have seen a more balanced market in the summer and early fall – suggesting that buyers could benefit from more negotiating power in the short term.

TRREB’s consumer polling shows that half of home buyers in Toronto will be first-time buyers in any given year. The average price of a condo in Toronto is over $700,000. Yet, the first-time buyer exemption for the City’s land transfer tax has remained at $400,000 since 2007. TRREB applauds Toronto City Council for asking City staff to provide a report on a more appropriate exemption level moving forward.