Home sales in the Toronto region saw 6,390 transactions in the last month after adjusting for seasonal factors, which amounted to a 34-per-cent increase over October of 2023.Fred Lum/The Globe and Mail
Toronto’s home sales climbed 14 per cent in October, the steepest monthly increase in nearly a year, as prospective homebuyers jumped back into the market after multiple interest-rate cuts.
There were 6,390 transactions in the Toronto region last month after adjusting for seasonal factors, which was a 34-per-cent increase over October of last year and the highest volume since January of this year, according to the Toronto Regional Real Estate Board, or TRREB.
Activity also swelled in other major Canadian cities last month, suggesting that the country’s real estate market may be beginning to rebound after two years of slow sales.
“It definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” TRREB president Jennifer Pearce said in a Wednesday news release.
For most of this year, sales have been subdued. Even after the Bank of Canada cut its benchmark interest rate in June, July and September, prospective homebuyers barely budged. But after the federal government announced easier mortgage rules and the central bank made a bigger interest-rate cut in October, more buyers made a purchase.
Mortgage rates have also been dropping, with the popular five-year fixed mortgage just above 4 per cent, according to mortgage rate comparison websites. That is lower than a year earlier when that product had an interest rate closer to 6 per cent. At the same time, more homeowners have been putting their homes up for sale, which has given would-be buyers more properties to choose from and has helped keep home prices steady.
Ms. Pearce said the lower borrowing costs and relatively flat home prices prompted the increase in activity.
Although new listings fell 6.8 per cent from September to October on a seasonally adjusted basis, there is still a relatively higher amount of homes up for sale. The board’s chief market analyst, Jason Mercer, said that, as residents buy those properties, home prices will start to increase.
For most of the year, typical home prices have hovered around the $1,100,000 mark in the Toronto region. The home price index, which removes the highest priced homes, was $1,082,500 last month after adjusting for seasonal influences. That was 0.1-per-cent higher than September and 3.4-per-cent lower than October of last year.
Mr. Mercer predicted that sales will pick up given expectations for even lower interest rates.
In Vancouver and Calgary, there was also a burst of activity over the past month. In Vancouver, home sales rose 42 per cent from September to October. Sales were only 5 per cent below the 10-year average compared with 26 per cent below that benchmark in the previous two months. The home price index for Vancouver region properties was $1,172,200, which was 0.6 per cent lower than September.
In Calgary, sales climbed 8.5 per cent from September to October. Unlike the rest of the country where home prices peaked in spring of 2022, Calgary’s home prices continued to rise when the central bank increased interest rates in 2022 and 2023. The typical home price in the region was $596,900 last month. That is about 12 per cent higher than spring 2022, whereas the national home price is down 16 per cent over that same period.
