GTA home prices rose in March, despite softer sales
March 2024 TRREB update
Penelope Graham, Director of Content
March marked a somewhat subdued housing market in the Greater Toronto Area, though early signs point to heating conditions in the later spring months.
The latest data from the Toronto Regional Real Estate Board (TRREB) reveal a total of 6,560 homes traded hands over the course of the month, down by -4.5% on an annual basis, and -1.1% from February. It’s a slight slowdown from the robust activity seen in the first two months of the year, though TRREB points to the Easter long weekend being a factor behind fewer transactions. Overall, sales rose 11.2% in the first quarter of the year, compared to the first three months of 2023.
In fact, the board points out, an influx of new listings reflects confidence that the spring market will be a brisk one; a total of 13,120 homes were brought to market, up 15% year over year.
Despite softer sales and rising supply, TRREB says there was enough competition between buyers to effectively push home prices higher. The average selling price came in at $1,121,615, up 1.3% year over year. Meanwhile the MLS Home Price Index, which reflects the most typical type of home sold, rose by 0.3%.
“We have seen a gradual improvement in market conditions over the past quarter. More buyers have adjusted to the higher interest rate environment. At the same time, homeowners may be anticipating an improvement in market conditions in the spring, which helps explain the marked increase in new listings so far this year. Assuming we benefit from lower borrowing costs in the near future, sales will increase further, new listings will be absorbed, and tighter market conditions will push selling prices higher,” said TRREB President Jennifer Pearce.
Rate cuts to heat sales in coming months
Anticipation that the Bank of Canada will soon lower borrowing costs is likely fueling market sentiment, as buyers may be waiting for a concrete rate cut before making their move. The central bank – while largely expected to hold its trend-setting overnight lending rate in its April 10 announcement – could be in a position to cut as early as June or July, according to market analysts.
“The average selling price edged up in comparison to last year as we moved through the first quarter of 2024. Price growth is expected to accelerate during the spring and even more so in the second half of the year, as sales growth catches up with listings growth and sellers’ market conditions start to emerge in many neighbourhoods. Lower borrowing costs in the months ahead will help fuel increased demand for ownership housing,” said TRREB Chief Market Analyst Jason Mercer.
Home prices heating faster within the 416
Sales fell across the entire GTA region in March, though to a lesser extent in the 905-area markets outside the City of Toronto. A total of 2,308 homes sold in the city, marking a -7% year-over-year decrease, compared to the 4,252 sold in the 905, down -2.4% from last year.
However, prices heated more aggressively within city limits, rising 3.2% to an average of $1,1087,017. Price growth, meanwhile, was flat in the 905, up just 0.1% to $1,140,395. New listings were up robustly on an annual basis in both regions, with 4,917 brought to market within the 416 (+13.3%), and 8,203 in the 905 (+16.2%).