July 4, 2024: The Toronto Regional Real Estate Board (TRREB) reported a significant decline in home sales for June 2024, with a 16.4% drop compared to the same month last year. Despite the highly anticipated interest rate cut by the Bank of Canada, many potential buyers remained hesitant.
Key Figures:
- Homes Sold: June 2024 saw 6,213 homes sold, a decrease from 7,429 in June 2023.
- Average Selling Price: The average price in the Greater Toronto Area (GTA) fell by 1.6% to $1,162,167 year-over-year.
- New Listings: There was a 12.3% increase in new listings, with 17,964 properties added to the market.
- Active Listings: The number of active listings surged by 67.4% to 23,613 compared to June 2023.
City and Regional Sales:
- City of Toronto: Home sales dropped by 20.6%, with 2,236 properties sold.
- Rest of GTA: Sales decreased by 13.8%, totaling 3,977 homes.
Impact of Interest Rate Cut: TRREB president Jennifer Pearce commented that the central bank’s recent 25-basis-point rate cut provided some initial relief but noted that the data suggests buyers might need further cuts to feel confident enough to re-enter the market. Ipsos polling for TRREB indicated that cumulative rate cuts of at least 100 basis points might be necessary to significantly boost home sales.
Market Analysis: TRREB chief market analyst Jason Mercer highlighted that the current market is well-supplied, giving buyers substantial choice and negotiating power on price. He added that as sales begin to rise with lower borrowing costs, the elevated inventory levels should help prevent a rapid increase in selling prices.
Property Type Sales Decline:
- Condos: Sales dropped by 28.1%.
- Townhouses: Experienced a 14.1% decline.
- Semi-Detached Homes: Fell by 11.4%.
- Detached Properties: Sales decreased by 10.6%.
The data underscores the cautious approach of buyers despite favorable conditions like lower interest rates and increased inventory. The TRREB continues to monitor the situation closely, anticipating further rate cuts may be required to stimulate significant market activity.
