Higher interest rates continue to squeeze would-be buyers
The Greater Toronto Area (GTA) saw home sales drop by 7.1% in September on a yearly basis as high borrowing costs continued to push buyers out of the market.
A total of 4,642 homes changed hands in the city and its surroundings last month, according to new data by the Toronto Regional Real Estate Board (TRREB), as semi-detached houses and townhouses posted significant sales declines compared with the same time last year.
Two successive 25-basis-point jumps by the Bank of Canada in recent months have clearly played a part in slowing the market, with the September figures marking a 12.1% decline from August, even despite the central bank having most recently hit pause on rate hikes.
OUT NOW! High interest rates impacting the market, but population growth will soon spur demand🏠. Access TRREB’s latest #MarketWatch Report for the latest #marketstats & MORE! 🔗https://t.co/349LeB3NnJ#RealEstateNews #CDNRealEstate #GTArealestate #GTArealtor #TorontoRealEstate pic.twitter.com/q3hDB5HdKI
— Toronto Regional Real Estate Board (@TheReal_TRREB) October 4, 2023
Still, home prices continued to climb on a month-over-month and yearly basis. The average home price in the region was just under $1.12 million in September, TRREB said, a 3.4% increase over August and 3% up over September 2022.
Steep borrowing costs are anticipated to continue until the middle of next year, according to TRREB president Paul Baron, before declining after that date and helping push up demand for home ownership towards the end of 2024.
Last month also saw much-needed supply begin to arrive on the Toronto market. New listings spiked by 44.1% compared with 12 months before, rising to 16,258 and improving over the prior month.
