REXIG SUMMARY
GTA Housing Market August 2024: Have Reduced Interest Rates Made a Dent in the GTA Housing Market?
The housing market in the Greater Toronto Area (GTA) has experienced a slight downturn in home sales in August 2024, decreasing by 5.3% year-over-year from 5,251 sales in August 2023 to 4,975 sales. Despite the dip in sales, new listings showed a modest increase, rising 1.5% year-over-year to 12,547. The region’s housing supply remains robust, which has contributed to a marginal decline in average home prices by 0.8% year-over-year to $1,074,425.
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The recent rate cut by the Bank of Canada is expected to enhance affordability, particularly benefiting those with variable rate mortgages and first-time buyers. Lowered mortgage rates are predicted to boost first-time buying activities, especially in the condo market, through the remainder of this year and into 2025.
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While the MLS® Home Price Index Composite benchmark declined by 4.6% year-over-year in August, the average selling price saw a lesser decrease, primarily due to a shift in the mix of homes sold, with a higher share of detached homes influencing the average price figures. On a seasonally adjusted basis, the average selling price slightly decreased compared to July 2024.
Future Outlook
Looking ahead, lower borrowing costs are expected to support buyers by reducing monthly mortgage payments and maintaining moderate home prices, even as market demand is expected to pick up in 2025. However, the current elevated inventory levels will take time to absorb, suggesting a gradual price growth in the initial recovery phase.
The focus on home construction remains critical to address the housing needs in the GTA. Municipal support in reducing development charges to keep new housing affordable is advocated, with a warning that without adequate and affordable housing options, potential homebuyers may look beyond the GTA and even outside Ontario or Canada. Housing is highlighted as a crucial factor in the region’s economic development, indicating a strategic need to balance market supply with consumer demand effectively.
REGIONAL SPOTLIGHT // AUGUST 2024 Kitchener-Waterloo Region Real Estate Market Report
In August 2024, the Waterloo Region's real estate market saw mixed responses, with detached homes experiencing strong demand despite a general cooling in residential sales. According to the Cornerstone Association of REALTORS®, 539 homes were sold, marking a 5.3% decrease from last year and a significant 24.1% drop from the decade's average for August.
Inventory and Listings
August witnessed a modest decrease in new listings, totaling 988, down 4.2% year-over-year but up 7.3% from the ten-year average. The total inventory was considerably higher at the end of August, with 1,640 homes available, a 49.2% increase from last year, pointing to a more buyer-friendly market.
Average Sale Prices
The average sale price for all residential properties stood at $769,203, a slight 1.1% increase from August 2023 but a 1.7% decrease from July 2024. Detached homes averaged $889,085, a marginal increase, while townhouses and condos saw price reductions, highlighting varied market conditions across property types.
Future Outlook
The outlook for the Waterloo Region's housing market hinges on potential further interest rate cuts by the Bank of Canada, which could stimulate buyer activity and impact home prices as market demand picks up in 2025. With substantial inventory levels, initial phases of recovery might feature stable pricing, though shifts could occur as inventories normalize.
Read here to read our economic update for last month.
ECONOMIC SPOTLIGHT
Insights from the Bank of Canada & Federal Reserve's Latest Monetary Policies // Q3 2024
As valued clients of REXIG Realty, we are excited to provide you with our latest Real Estate Market Report
for the Greater Toronto Area & surrounding regions.
Our goal is to keep you informed and empowered with the most up-to-date information to make
informed decisions regarding your real estate investments.
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