The Greater Toronto Area real estate market saw a rise in buyer activity in July 2024, with sales increasing compared to the same period last year. Despite this uptick, buyers continue to benefit from a well-supplied market, as new listings outpaced sales growth, providing more choices and slightly easing price pressures.

In July 2024, 5,391 home sales were reported, marking a 3.3 per cent increase from July 2023. New listings rose by 18.5 per cent year-over-year to 16,296, offering buyers a broader selection of properties. Despite the increased inventory, the average selling price was $1,106,617, down just 0.9 per cent from last July, indicating stable pricing amidst higher supply.

Interest Rates and the Housing Market

The Bank of Canada's recent rate cuts have positively impacted buyer confidence in the GTA real estate market. As reported by The Globe and Mail, "The widely anticipated move brings the bank’s policy rate to 4.5 per cent from 4.75 per cent. It’s the second step in a long-awaited easing cycle that is slowly normalizing borrowing and debt-servicing costs for Canadians." As the cost of borrowing continues to decrease, more potential buyers are expected to enter the market, encouraged by lower monthly mortgage payments and improved affordability. TRREB President Jennifer Pearce anticipates that this trend will lead to an acceleration in sales, as lower interest rates make homeownership more accessible to a broader range of buyers.

July 2024 Asset Class Performance

·         Condos: Sales totaled 1,482, reflecting a 1 per cent year-over-year decline. Despite a 64 per cent increase in listings to 8,879, the average price remained stable at $718,698.

·         Detached Homes: The detached segment recorded 2,446 sales, slightly down from last year, with an average price of $1,425,927, a 3 per cent year-over-year decrease. Inventory reached 10,083, the second consecutive month of the highest inventory since September 2019.

·         Semi-Detached and Townhouses: Semi-detached home prices fell to $1,067,576, a 3 per cent decrease, with sales of 471. Townhouses averaged $1,018,731, a 1 per cent decrease, with sales of 504. Both asset classes saw significant inventory increases, offering buyers substantial choices.

Future Outlook

The recent interest rate cuts by the Bank of Canada have begun to rejuvenate buyer confidence, starting to make borrowing more affordable and stimulating interest in home purchases. As these rates continue to decline, the market is well-positioned for further sales growth.

With inventory levels currently high, buyers have more options, leading to stable prices. However, as this inventory is gradually absorbed and borrowing costs continue to decrease, there is potential for upward pressure on home prices.

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