Is housing in the GTA becoming more affordable?

GTA home sales fell 5.3% year-over-year in August 2024, with a slight increase in new listings. Despite a modest dip in average home prices, the market remains well-supplied. Recent Bank of Canada rate cuts are expected to enhance affordability, especially for first-time buyers.

Market Summary

• Sales Momentum: Sales decreased by 5.3% compared to August 2023 and 7.72% from July 2024.

• Listing Dynamics: New listings were up 1.5% year-over-year but down 23% from July 2024.

• Active Listings: Active listings increased by 46% from 2023 but saw a 5.1% decline from July 2024.

• Price Trends: Average home prices were down 0.8% year-over-year and 7.72% from July 2024.

• Market Status: With 5 months of inventory, the GTA market is currently in a buyer's market. Sales to new listings ratio fell 3% from 2023 but rose 7% from July.

• Time to Sell: Listings spent an average of 28 days on the market, while properties were on the market for 44 days.

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Impact of Interest Rates

On September 4th the Bank of Canada reduced it’s policy rate for the third straight time by a quarter point. The Bank of Canada’s recent rate cut is poised to improve housing affordability, particularly benefiting those with variable-rate mortgages. As borrowing costs decrease, we anticipate increased first-time buyer activity, which could stimulate the condo market and overall housing demand.

What Does This Mean for Buyers and Sellers?

For Buyers

Buyers will find favorable conditions with lower mortgage rates and modestly reduced home prices. The current market offers more choices, particularly in the condo sector, making it an opportune moment for those looking to enter or upgrade within the market.

For Sellers

Sellers in the GTA may experience a slower pace of sales due to the year-over-year decline, despite a stable inventory. With average prices slightly down, sellers should be prepared for modest offers but can benefit from increased buyer interest as affordability improves over time.

In Conclusion 

The GTA housing market is navigating a period of adjustment with declining sales and slightly lower prices. The recent rate cut promises to boost affordability and buyer activity, setting the stage for a gradual market recovery.

Get the Help You Need:

Ready to buy or sell in the GTA? Contact us today for expert guidance and personalized support to navigate this evolving market and make the most of current opportunities.

Call Ben at 905-995-23372 or Jim at 905-409-9967

Greetings, GTA homebuyers and sellers! As we step into June, it's time to reflect on the dynamic real estate landscape that unfolded throughout May 2024. Join us as we uncover the latest insights and trends from the past month, offering a clear perspective on what May's market stats mean for your real estate journey. At Jim Stanton & Associates, our commitment to providing you with valuable information remains steadfast. Let's explore together the opportunities and possibilities that await in the ever-evolving GTA market.

Market Summary: In May 2024, the GTA real estate market showed mixed signals:

• Sales Momentum: Compared to the same period last year, sales decreased by 21.7%. There was a month-over-month decrease of 1.42%.

• Listing Dynamics: New listings were up 21.1% from 2023 and 9.9% month-over-month.

• Active Listings: Active listings saw a significant increase, up 83.3% from 2023 and 20.3% from April 2024.

• Price Trends: The average price for homes was down 2.5% year-over-year but saw a slight increase of 0.8% month-over-month.

• Balanced Market: With 3 months of inventory available, the market was balanced.

• Time to Sell: Days on Market remained stable month-over-month.

Click here to view the TRREB Market Watch Report for May 2024

What's happening? Toronto Market Insights

Interest Rates

On June 5th, the Bank of Canada decreased its policy interest rate by 25 basis points. This is the first move since July 2023 and the first reduction since it began increasing the rate in March 2022 from its record low of 0.25%. The last time interest rates were lowered by the Bank of Canada was when the Bank dropped rates to an all-time low at the onset of the pandemic in March 2023.

What Does This Mean for Buyers and Sellers?

For Buyers:

Buyers are poised to benefit from the recent interest rate reduction, which is expected to increase buying power and push more buyers into the market. As a general rule of thumb, a ¼ point decrease in interest rates adds about $10,000 to the average borrower's buying power, though this depends on individual circumstances. However, with more buying power, competition is likely to heat up, especially for entry-level homes. Lower rates can be tempting, but remember that while waiting for further reductions, competition will likely increase. If you buy now, you pay today's prices and can always refinance at a lower rate later. Waiting might get you a lower rate, but you'll likely be paying a higher price.

For Sellers:

Luxury homes have been taking longer to sell in the higher interest rate environment. Hang in there; lower rates may bring more buyers. Expect competition to increase even more on entry-level homes like townhomes and links. These homes are always in demand, and these changes will only spur more competition. With rates finally starting to come down, now is the time to plan your next move. Information is power, and you only benefit by starting the process now.

Conclusion:

In conclusion, May 2024 witnessed a mix of trends in the GTA real estate market, presenting a balanced environment for both buyers and sellers alike. Despite fluctuations in sales compared to last year, there was a notable month-over-month decrease. The surge in new and active listings indicates a healthy influx of properties, while pricing trends remained relatively stable. With inventory levels maintaining a balance, the market is poised for potential changes depending on the upcoming interest rate adjustments. Looking ahead, proactive engagement will be key for both buyers and sellers to capitalize on emerging opportunities. At Jim Stanton & Associates, we're dedicated to providing the guidance and support necessary for navigating this dynamic landscape effectively.

Get the Help You Need:

Regardless of the statistics and the market, you have your own reasons for making a move. A big life event, ambitions, the need to upsize or downsize, or even relocate. The key is to ensure you have someone in your corner representing your best interests. Let us be your guide. Contact Us Today!

Call Ben at 905-995-3372