As the temperatures dropped, the Greater Toronto Area witnessed another month of declining home sales in November, as reported by the latest data from the Toronto Regional Real Estate Board (TRREB).
Last month, the GTA recorded 4,236 home sales, indicating an 8.8% decrease from October and a 6% dip compared to November 2022. When adjusted for seasonal variations, which typically lead to reduced activity in winter, the sales numbers showed a slight improvement from October, according to TRREB.
Throughout the year, factors such as high borrowing costs, economic uncertainty, and a persistent lack of affordability have hampered home sales, prompting prospective buyers to postpone their purchases until it makes more financial sense.
"Inflation and elevated borrowing costs have impacted affordability significantly," noted TRREB President Paul Baron. "Nowhere is this more evident than in the interest rate-sensitive housing market."
As sales declined, so did prices, with the average home price in the GTA dropping by 3.9% month over month to a new average of $1,082,179. This aligns with the average price observed in November 2022, showing minimal additional value gains for many homes over the past year. In Toronto, Ontario's busiest market, home prices fell by 6.8% month over month, accompanied by a 12.5% reduction in sales. The most substantial change was observed in Toronto's detached homes, where sales plummeted by 21.3%, and the average price decreased by over $100,000 to $1,617,918, down from $1,718,440.
"Home prices have adjusted in response to higher borrowing costs," explained TRREB Chief Market Analyst Jason Mercer. "This has provided some relief for buyers from an affordability perspective. As mortgage rates trend lower next year and the population continues to grow at a record pace, expect demand to increase relative to supply, leading to renewed growth in home prices."
Despite the overall decline, certain areas experienced minimal fluctuations in demand month over month. Halton Region, for instance, maintained nearly the same number of sales (increasing by only three), while its average price climbed by several thousand dollars to $1,208,950. Oakville, in particular, witnessed an average price rise from $1,395,752 to $1,572,012—a gain of nearly $200,000.
For those ready to make a home purchase now, there is a noticeable increase in the number of homes available compared to last year. Inventory levels received a substantial boost in November, with 10,545 new listings entering the market, bringing the total number of active listings to 16,759—a 40.7% surge from November 2022. However, with demand simmering below the surface among potential homeowners, TRREB CEO John DiMichele is urging governments to take more action, anticipating a growing housing demand "for years to come."
"We have seen some productive policy decisions recently that should help with housing affordability, including allowing existing insured mortgage holders to switch lenders without the stress test," said DiMichele. "Additionally, in the interest of household and economic stability, we continue to call on the Office of the Superintendent of Financial Institutions to apply the same approach to uninsured mortgages. It also goes without saying that further policy work is required to bring more supply online."
