Flood of new home listings hit Toronto market in September

The Toronto housing market was deluged with homes for sale in September as sellers decided to list their properties after months of no action.

The volume of new listings rose 9.8 per cent from August to September on a seasonally adjusted basis, according to the Toronto Regional Real Estate Board. That gave buyers even more choice and likely contributed to the 3.3-per-cent increase in sales last month.

For most of this year, activity has been dead in the Toronto region and across the country. Many home sellers took their properties off the market in July and August because sales were so slow, according to realtors. Meanwhile other prospective home sellers decided to wait until the fall in anticipation of people returning from summer holidays. That led to the September surge in homes available for sale.

“We went from next to no listings to a flood of listings,” said Joshua Jean-Baptiste, real estate broker with Sage Real Estate. “Every seller who had a house they wanted to sell was waiting for September and everyone had the same thought at the same time,” he said.

With the growing number of properties available for sale, many prospective homebuyers have not felt the pressure to act quickly. Mortgages are still relatively expensive even though the Bank of Canada cut its benchmark interest rate three times in recent months.

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Home showings have increased but sales are still slower than normal. There were 5,501 transactions last month. That is about 30 per cent below the 10-year average for September, according to the board.

The home price index, which excludes the most expensive properties, was $1,079,000 in the Toronto region last month. That was 0.5 per cent lower than August and 5 per cent lower than September, 2023. Halton and Peel, the regions to the west of the city of Toronto, have experienced sharper price drops over the past year. Meanwhile the home price index in the city and to the east in Durham is down about 4 per cent.

Mr. Jean-Baptiste said one of his clients put their home up for sale in mid-September. The house was listed with an asking price of just under $1.2-million.

He said there have been more than 30 showings and upward of 100 people attending the open house. But he added that within a one kilometre radius of the listing, there are 23 other homes for sale. “Many buyers are in a state of wait and see,” he said. “We haven’t had a day without a showing. But people are just taking their time.”

The real estate industry expects demand to grow as the central bank is expected to continue cutting interest rates. As well, the federal government has loosened its mortgage policies to make it easier for first-time buyers to purchase a home and will require lower down payments on homes valued at more than $1-million. The new rules go into effect mid-December and are expected to contribute to higher sales and prices.

In Vancouver, the home price index was $1,179,700 last month, according to Greater Vancouver Realtors. That was 1.4 per cent lower than in August and 1.8 per cent below September, 2023. Sales in the country’s priciest real estate market were down 2.7 per cent from August to September. Meanwhile, the number of new listings increased 50 per cent over the prior month.

The realtors group said on its website that the recent reductions in borrowing costs are having a limited effect in spurring demand so far and that the drop in prices was a result of sales not keeping pace with the number of homes coming on the market.