Toronto home sales continued slump in September as new listings hit 20-year low
Published Wednesday, October 5, 2022 5:00AM EDT
Last Updated Wednesday, October 5, 2022 11:14AM EDT
The average price of a Toronto home was down by 4.25 per cent in September, marking the first year-over year decrease since the slide in property values began last winter.
The latest data released by the Toronto Region Real Estate Board (TRREB) suggested that the market actually showed signs of stabilizing in September, with the average resale price across all property types coming in at $1,086,762 compared to $1,079,705 the previous month. .
However, the seasonally adjusted average was still down month-over-month after a surprise increase in August. Across all property types, sale prices fell by about $50,000 compared to September, 2021.
It is the first year-over-year decrease in Toronto real-estate prices since an aggressive campaign to hike interest rates began to weigh on the market last March.
In a news release, TRREB said that the housing market appears to be continuing “its adjustment to higher borrowing costs” with sales down 44.1 per cent from September 2021.
But there are some signs that the market could be slowing its descent as September marked the third straight month of marginal price increases.
TRREB also pointed out that new listings were at a 20-year-low for September, which could help support prices should the trend continue.
“The drop in overall listings to really a 20-year low I think is sort of the biggest story of the release. It is something we have been seeing trend for the last couple months,” TRREB President Kevin Crigger told CP24 on Wednesday morning. “With a rise in interest rates and all the things happening in the world people are taking a wait and see approach certainly on the buy side and largely on the sale side we are seeing the same thing where sellers really are not pushed to make a move. I think people who are looking to make sort of a discretionary sale and maybe trade within the market certainly are not rushing to do so right now.”
The Bank of Canada has increased its key overnight lending rate from 0.25 per cent to 3.25 per cent so far this year, significantly increasing the cost of borrowing.
That, in turn, has put pressure on the housing market, with RBC suggesting that a “historic” correction was likely to materialize.
CMHC also recently adjusted its housing forecast and is now projecting that home prices could fall by as much as 15 per cent from peak to trough.
The latest data provided by TRREB for September shows that more expensive property types have been hit the hardest, with the average price across the GTA falling by more than 10 per cent year-over-year.
Condominium apartments were the only property type in which prices rose year-over-year. They were up 3.2 per cent on average.
Crigger told CP24 that there was “a marginal lift in September compared to August in both price and overall volume.”
Meanwhile, the data points to much more favourable conditions for buyers compared to a year ago.
In September there were 13,534 active listings in the GTA, compared to 9,187 in September 2021. Properties also sat on the market for an average of 35 days last month compared to 19 days in September 2021.