Fall Real Estate Market in The GTA
This past week the Toronto Regional Real Estate Board (TRREB) released it's market stats for the month of September. According to the TRREB, The impact of high borrowing costs, high inflation, uncertainty surrounding future Bank of Canada decisions and slower economic growth continued to weigh on Greater Toronto Area (GTA) home sales in September. “The short and medium-term outlooks for the GTA housing market are very different. In the short term, the consensus view is that borrowing costs will remain elevated until mid-2024, after which they will start to trend lower. This suggests that we should start to see a marked uptick in demand for ownership housing in the second half of next year, as lower rates and record population growth spur an increase in buyers,” said TRREB President Paul Baron.
TRREB reported 4,642 sales in September down 12.3% from August and down 7.9% from last year. While sales were down New Listings surged in the month at 16,258 or a jump of 32% from August. Active Listings at month end were 18,912 or 22% higher than last month. When the numbers get to this level we can state we are in a balanced market. This is something we haven't seen in quite some time. The average selling price for all home types was $1,119,428 up from August by 3.4% despite so many active listings. Detached, semi's and town homes contributed to this jump with detached up 1.7% to $1,440.786, semi's up 2.4% to $1,095,074 and towns up 2.0% to $1,043,076. A decline was reported in Condo townhomes of (3.2%) at $810,495 and Condo Apartments were unchanged at $$707,065.
Current mortgage rates as provided by Dominion Lending show some borrowers may face qualifying rates of over 8% when 2% is added to the base rate. This makes mortgage qualification out of reach for many would be Buyers. Recent bond market trends of rising yields is a precursor to fixed mortgage rates which we have seen rise in recent days. Buyers need to understand that these rates with be with us for a while. So fewer Buyers and an increase in active listings should put downward pressure on selling prices (Although we didn't see it in September) . Sellers need to be prepared to face this this new reality in the weeks ahead.
We believe that right now and for the next few weeks is a great buying opportunity for qualified Buyers. Speak to us to learn more.
The thing to remember is that homes sell in all market conditions. Understanding how the market affects your own situation is key to a successful real estate transaction. This is why you need an experienced REALTOR on your side. We can help you understand and navigate the current market conditions to make the best choice for your own situation. We are not afraid to say "maybe it's not a good time to buy or sell based on your own circumstances".
Coming on December 1st, Ontario is enacting new amendments to the legislation governing real estate transactions in Ontario. These changes are significant and will affect how REALTORS interact with Buyers and Sellers. New rules will restrict how an Agent can interact with Buyers and how homes are shown and sold. Agents will no longer be able to act on behalf of a consumer unless they become clients first. Consumers may choose to act on their own but Agents can no longer provide any advice or even show properties, that aren't there own brokerage without a client agreement. Much confusion is expected to enter the market as most consumers will not be aware of the changes and how they affect them. Things will not operate as they have in the past without a client agreement. Open bidding will become available at the Sellers direction if they choose. This will undoubtedly add more confusion to a real estate transaction and the communication necessary between buyer and seller agents. More paperwork will be the end result that Buyers and Sellers will have to understand. We will provide updates as the new rules and paperwork are made available to us. This legislation was initially to have been launched in April 2023 but delays pushed it off to December 1st. Stay tuned!