Home sales in the Toronto Region have seen a year-over-year dip of 34.2%, with 5,627 sales reported in the month of August, according to TRREB (Toronto Region Real Estate Board). While the decline is significant versus last year, August saw a bit of a rebound in volume versus earlier in the summer.. August also saw a greater share of new listings compared to the previous three months, up almost 15% from July. There is a possibility we could see some support for selling prices in the months ahead if this trend were to continue.
According to TRREB, the MLS Home Price Index (HPI) was up by 8.9% on a year-over-year basis and the average selling price for all home types was up by 0.9% to $1,079,500. The average selling price was also up slightly month-over-month, while the HPI Composite was lower compared to July. These results would suggest that a greater share of more expensive home types were sold this past August.
Data suggests expensive homes were sold more often in August
Detached home sales saw an 18% jump over last month, the highest amount of growth among all property types in the TRREB region, with 2,595 sales, and an average price of $1,379,700, up 1% from last month, the only property type to increase in average price over July. York and Durham saw the highest number of detached homes sold, with 568 and 542 respectively.
Condo apartments continue to be the most affordable option with an average price of $711,321, down 1% from last month’s average of $719,273. The demand has also increased, with 1,028 sales, up 7% from July. 159 semi-detached homes have been sold at an average price of $1,127,429, with sales down 10% from last month and the price down 11%. Condo townhouses saw 121 sales, down 13%, at an average price of $818,935, down 4%.
The impact of rising interest rates
Climbing interest rates, inflation and fluctuations in prices have left many would be buyers and sellers on the sidelines this Spring & Summer. Detached homes and semi-detached homes have both seen a 3% dip in prices from 2021, with average prices coming in at $1,379,700 and $998,490 respectively. Those on the property hunt will have generally found that prices in recent months are below the highs of early 2022 but for the first time this year have also shown signs of dipping past last year’s highs. With a pending Bank of Canada rate hike expected this September; the increased borrowing costs for first time home buyers and mortgage renewals has left many speculating about the effect on prices for the upcoming Fall market.
TRREB President, Kevin Crigger, said: “There is room for the federal government to provide greater housing affordability for existing homeowners by removing the stress test when existing mortgages are switched to a new lender, allowing for greater competition in the mortgage market. Further, allowing for longer amortization periods on mortgage renewals would assist current homeowners in an inflationary environment where everyday costs have risen dramatically.”
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