GTA resale market more balanced in July – TRREB

Greater Toronto Area GTA home sales, new listings and home prices were up in July 2023 in comparison to July 2022, according to the Toronto Regional Real Estate Board (TRREB). On a seasonally adjusted basis, the market experienced more balance in July compared to June, with sales trending lower while new listings were up.

“Home sales continued to be above last year’s levels in July, which suggests that many households have adjusted to higher borrowing costs,” says TRREB President Paul Baron. “With that being said, it does appear that the sales momentum that we experienced earlier in the spring has stalled somewhat since the Bank of Canada restarted its rate tightening cycle in June. Compounding the impact of higher rates has been the persistent lack of listings for people to purchase compared to previous years.”

Uncertainty around borrowing costs

GTA realtors reported 5,250 sales through TRREB’s MLS system in July 2023, representing a 7.8-per-cent increase compared to July 2022. Over the same period, new listings were also up, but by a greater annual rate of 11.5 per cent. The MLS Home Price Index Composite benchmark was up by 1.3 per cent year-over-year. The average selling price was also up by 4.2 per cent to $1.11 million over the same timeframe.

On a seasonally adjusted monthly basis, the number of sales trended lower for the second straight month, whereas new listings trended upward. The seasonally adjusted average selling price edged lower while the MLS HPI Composite benchmark edged higher.

“Uncertainty surrounding the direction of borrowing costs, jobs and the overall economy has impacted home sales over the last two months,” says TRREB Chief Market Analyst Jason Mercer. “Over the long term, the demand for ownership housing will remain strong on the back of record population growth. However, many homebuyers will continue to be on the sidelines in the short term until the direction of monetary policy and the economy becomes clearer.”

Misalignment in public policy

“We continue to suffer from a misalignment in public policy as it relates to housing,” adds TRREB CEO John DiMichele. “The federal government is targeting record levels of immigration for the foreseeable future, but we have seen very little tangible progress in creating more ownership and rental housing to accommodate this growth. Population growth is imperative for economic development; however, this growth will be unsustainable if people can’t find an affordable place to live. All three levels of government need to be on the same page to fix this problem.”