Lack of affordability and uncertainty remained issues for many would-be home buyers in the Greater Toronto Area (GTA) in October 2023. As a result, sales edged lower compared to last year. However, selling prices remained higher than last year's levels.
The fall market is off to a calm start as home supply builds giving buyers less competition and more choices. The uncertainty around the Bank of Canada's upcoming interest rate announcement is also creating some hesitancy for home buyers
With continued uncertainty about the economy and the Bank of Canada's decision-making, increased borrowing costs, and a constrained supply of listings, the month of August resulted in fewer home sales compared to the previous year.
GTA home sales, new listings and home prices were up in July 2023 in comparison to July 2022. The market experienced more balance in July compared to June, with sales trending lower while new listings were up.
The GTA housing market continued to improve from a sales perspective in May 2023. Unfortunately, the supply of homes for sale did not keep up with the demand for ownership housing.
On a year-over-year basis, sales edged lower compared to April 2022, but new listings were down by more than one-third. Fewer listings relative to sales meant there was more competition between buyers, supporting an improvement in selling prices.
New listings continue to drop year-over-year in the GTA. This severe inventory shortage, coupled with an increase in buying intentions and demand have lead to increased competition between buyers and a return to bidding wars in some.
GTA home sales in October were down 49% since last year. The market continues to adapt to a higher borrowing cost environment. But, how does the ongoing lack of inventory affect current home prices?
GTA home sales were down 34.2% from last year, showing a lesser annual decline than seen in the last 4 months. Sales represented a higher share of new listings. Could this indicate some support for home sale prices?
Rapidly increasing mortgage rates continue to lead to more balance in the market. GTA home sales in July were down 47% from last year, while annual price growth moderates, and buyers benefit from greater choice.
With higher borrowing costs and buyers moving to the sidelines to reposition themselves in a higher rate environment, the GTA housing market continues its adjustment with transaction numbers down.