Toronto-area home sales rose in September while prices continued to decline, as the city’s real estate board says the market could continue heating up amid ample choice and lower borrowing costs.
The Toronto Regional Real Estate Board said the 5,592 homes sold last month was up 8.5% from September of last year, and up 2% on a seasonally adjusted basis from August. The rise in sales came as the average selling price was down 4.7% from last year to $1,059,377, and the composite benchmark price was down 5.5% in September. Compared with August, the average selling price ticked up 0.2%.
“The Bank of Canada’s September interest rate cut was welcome news for homebuyers,” said TRREB president Elechia Barry-Sproule in a press release. “With lower borrowing costs, more households are now able to afford monthly mortgage payments on a home that meets their needs.”
The central bank cut its benchmark rate by a quarter-percentage point to 2.5% on Sept. 17, breaking a streak of three consecutive holds since March.
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GTA home sales show early rebound
Consumers are starting to recognize “a new normal” when it comes to the economic and political situation, said Cailey Heaps, president of the Heaps Estrin Real Estate Team in Toronto. Although the GTA has not returned to the peak levels of activity seen during the pandemic years, there are “rays of sunshine within the market,” said Heaps.
“We’re likely near the bottom or climbing out of the bottom, so it feels like opportunistically a good time to enter (the market),” she said in a phone interview. “I think there’s sort of this buyer mindset of, ‘It’s OK to buy again.’”
New listings of 19,260 were up 3.9% from last year, and down 3.3%, seasonally adjusted, from August. Active listings were up 18.9% from last year with 29,394 homes on the market.
In the City of Toronto, there were 2,063 sales last month, a 13.2% increase from September 2024. Throughout the rest of the GTA, home sales were up 5.9% to 3,529. Overall, all property types saw more sales in September compared with a year ago throughout the region. The largest increase was in the semi-detached segment, which was up 11%, followed by detached houses with a 9.6% increase and condos with a 7.2% increase. The number of townhouses that changed hands was 4.4% higher than in September 2024.
Lower rates may spur buyer activity
The board said more interest rate cuts from the Bank of Canada could help further push up sales.
“While home sales have improved over the past year, they still remain below normal levels relative to the number of households in the GTA,” said the board’s chief information officer Jason Mercer. “Two more 25-basis-point interest rate cuts by the Bank of Canada would see monthly mortgage payments move more in line with homebuyers’ average incomes, further spurring home sales and related economic activity.”
Heaps said “it will be some time” before the market truly soars back to peak levels, but continued interest rate cuts are one factor that will lure potential buyers off the sidelines. “We need to see tightening of inventory and that will just inherently happen as buyers re-enter the market,” she said. “From a broader perspective, people just need to get comfortable that the Canadian economy is heading in the right direction.”
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