TORONTO - The Toronto Regional Real Estate Board says Greater Toronto home sales in March were down 4.5 per cent from last year, but there was enough competition between buyers that the average home price rose moderately year-over-year.

A total of 6,560 homes changed hands in the month compared with 6,868 last year. The board noted this year's sales figures were down in part due to the statutory Good Friday holiday falling within March rather than April.

On a seasonally adjusted monthly basis, sales were down by 1.1 per cent.

The average selling price was up 1.3 per cent year-over-year to $1,121,615.

“Price growth is expected to accelerate during the spring and even more so in the second half of the year, as sales growth catches up with listings growth and sellers' market conditions start to emerge in many neighbourhoods,” said TRREB chief market analyst Jason Mercer in a press release.

“Lower borrowing costs in the months ahead will help fuel increased demand for ownership housing.”

Affordability continues to be a major challenge for prospective buyers in the Toronto area, said Chris Kapches, president and CEO of Chestnut Park Real Estate Limited.

He said that even with forecasts that the Bank of Canada will likely lower its key interest rate later this year, many people will still find themselves priced out of the market.

“Population growth has become so prominent in terms of driving this marketplace, and driving the demand, that prices have stayed high, while at the same time sales have fallen off because of affordability,” Kapches said in an interview.

“We don't see buyers shooting the lights out because they're constrained ... and I think that is going to be the continuing pattern of this market as we go forward.”

New listings were up 15 per cent last month from March 2023, which TRREB president Jennifer Pearce attributed to homeowners possibly anticipating an improvement in market conditions in the spring.

“Assuming we benefit from lower borrowing costs in the near future, sales will increase further, new listings will be absorbed, and tighter market conditions will push selling prices higher,” said Pearce in a press release.

The first quarter ended with 11.2 per cent higher sales year-over-year and new listings up by 18.3 per cent for the three-month period.

Kapches said his advice to clients is that they may need to look far out in the Greater Toronto Area for affordable home prices if they are set on staying nearby. He pointed to Scarborough as an area where prices for condominium apartments are more feasible.

“It's kind of a terrible cliche, but you drive until you're qualified,” he said.

“People are moving to other parts of the province where it's more affordable. In some cases, people are moving to other provinces.”

In the City of Toronto, there were 2,308 sales last month, an eight per cent decrease from March 2023. Throughout the rest of the GTA, home sales fell 2.5 per cent to 4,252.

By property type, sales of condo apartments saw the biggest decrease throughout the GTA, with 12.8 per cent fewer changing hands. There were also three per cent fewer detached home sales in March.

Meanwhile, there were 4.3 per cent more semi-detached home sales, followed by a 1.1 per cent increase in townhouse sales.

This report by The Canadian Press was first published April 3, 2024.