GTA home prices show signs of stabilizing

 It is the first year-over-year decrease in Toronto real-estate prices since an aggressive campaign to hike interest rates began to weigh on the market last March.

In a news release, TRREB said that the housing market appears to be continuing “its adjustment to higher borrowing costs” with sales down 44.1 per cent from September 2021.

But there are some signs that the market could be slowing its descent as September marked the third straight month of marginal price increases. Previously, TRREB’s home price index had fallen for four consecutive months.

“Hovering just below $1.1 million, the average selling price may have found some support during the last couple months of summer,” TRREB Chief Market Analyst Jason Mercer said in the release. “With new listings down quite substantially year-over-year and well-below historic norms, some home buyers are quite possibly experiencing tighter market conditions in some GTA neighbourhoods.”

The Bank of Canada has increased its key overnight lending rate from 0.25 per cent to 3.25 per cent so far this year, significantly increasing the cost of borrowing.

That, in turn, has put pressure on the housing market, with RBC suggesting that a “historic” correction was likely to materialize.

CMHC also recently adjusted its housing forecast and is now projecting that home prices could fall by as much as 15 per cent from peak to trough.

The latest data provided by TRREB for September shows that more expensive property types have been hit the hardest, with the average price across the GTA falling by more than 10 per cent year-over-year.

Condominium apartments were the only property type in which prices rose year-over-year. They were up 3.2 per cent on average.

Meanwhile, the data points to much more favourable conditions for buyers compared to a year ago.

In September there were 13,534 active listings in the GTA, compared to 9,187 in September 2021. Properties also sat on the market for an average of 35 days last month compared to 19 days in September 2021.

Source: CTV News