The Rise and Fall: Analyzing GTA Real Estate Changes This September!

September went by in a flash and we are about a week away from Thanksgiving, fall will be over before we know it!  The GTA housing market began to improve this past September with home sales up 8.5% over the same month last year. Buyers are starting to take advantage of more affordable market conditions brought about by interest rate cuts (3 so far) and lower home prices.

Ciao! Welcome to a new episode of Building Wealth Through Real Estate...Brick by Brick with me, Nico James-Bock, Founder of The CondoWiz™ Group and Broker at Royal LePage Signature Realty in Downtown Toronto.  

The number of available homes for sale of all types increased by over 35% to 25,612, continuing the Buyers Market trend of over 5 months of available inventory.  The average selling price, $1,107,291 was down by only 1% compared to September 2023's average of $1,118,215. On a seasonally adjusted basis, the average selling price edged up slightly compared to August.

The Toronto Regional Real Estate Board's Chief Market Analyst, Jason Mercer, stated that there continues to be a better-supplied market allowing for increased negotiating power for buyers re-entering the market. The ability to negotiate on price, led to moderate year-over-year price declines, particularly in the more affordable condo apartment and townhouse segments that are popular with first time buyers.  

What's Next?

BoC Interest Rate Announcements

• October 23  which happens to be my 🎂
• December 11

New Mortgage Rules December 15

Transcript

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Nico James-Bock: There have been major changes in the residential real estate market. I want to present you with the 5 takeaways.

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Nico James-Bock: My name is Nico James Bach. I am a broker at royal page signature, realty in downtown Toronto.

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Nico James-Bock: These are the major shifts that took place during the month of September. Welcome to another episode of building wealth through real estate, brick by brick.

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Nico James-Bock: If you've been paying attention to the media, the past 2 weeks and or tuned in to

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Nico James-Bock: my latest, podcast your fees are probably blowing up with all of the exciting mortgage changes coming this December.

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Nico James-Bock: the Federal Government recently announced. They are introducing new options for insured mortgages that extend amortization periods to 30 years and reduce the down payment required for homes priced between 1,000,001.5 million.

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Nico James-Bock: So what does this mean? It means the dream of home ownership is becoming more accessible for more people. This new mortgage rule has increased both your buying power and your ability to pre-qualify.

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Nico James-Bock: So September 2024 market stats were just released by the Toronto Regional Real Estate Board, and, yours truly, has curated the stats for you for the various macro markets and the sub markets.

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Nico James-Bock: Home sales in the Gta have increased shockingly by 8.5%. This September compared to last year, indicating that market conditions are becoming slightly more favorable for buyers.

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Nico James-Bock: Most pockets, however, are still in balanced market territory. Prices are adjusting and interest rates are more accommodating than they've been in a while.

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Nico James-Bock: The number of new listings has also risen by over 10% from last year to providing a greater selection and better opportunities to negotiate. So if you're thinking about entering the market or finding a new place.

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Nico James-Bock: now could be an ideal time for you, jumping right to the September 2024 market stats. I'll look 1st at the Gta, the Macro market, the number of available homes for all sales of all types increased by over 35%

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Nico James-Bock: to 25,612 in the Gta.

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Nico James-Bock: continuing the buyer's market trend of over 5 months of available inventory

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Nico James-Bock: on a macro market level. The average selling price is 1,107,291. It was down by only 1% compared to September 2023, that average of 1,118,215

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Nico James-Bock: on a seasonally adjusted basis, the average selling price edged up slightly compared to August.

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Nico James-Bock: I want to go straight to Durham region.

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Nico James-Bock: Durham Region market stats this is the only region that is showing a sub 1 million dollar average price Durham region is showing $927,723 as the average price. It's

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Nico James-Bock: down slightly over a year to date, but they're showing also 3.5 6 months of inventory. So just a little bit over 3 and a half months of inventory, which is actually the lowest of all the

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Nico James-Bock: sub markets. So we're experiencing. We're seeing tighter conditions, lower inventory levels in germ region. This means that there could be opportunities for those looking in the germ region. So we're talking about Pickering, Ajax Whitby.

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Nico James-Bock: This could be an area of great interest. I've talked about the Durham region and the opportunities that exist in that region for the past 6 months. Durham region has consistently shown average market average selling price at below 1 million. This is not going to last for much longer. I suspect that Durham region will breach the 1 million dollars mark by, if not the end of this year. By the 1st quarter of 2025.

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Nico James-Bock: If we go to the Toronto market, which is another Macro market. It is showing an average sale price of 1,107,439

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Nico James-Bock: now this is up point 6%. So a slight increase year to date

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Nico James-Bock: Toronto, however, is showing a little bit over 5 and a half months of inventory. So 5.5 4 that's quite high. We've been talking quite a long time about the amount of particularly condominiums that are sitting on the market.

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Nico James-Bock: So that is contributing to the months of inventory number that we're seeing for Toronto. Condo sales are up slightly 1.6% to 864 sales or transactions, with an average price down slightly at 707,917, a reflection of the high inventory and sluggish market conditions in this sector. If we go quickly back to the Gta market stats, which concludes all of the sub markets.

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Nico James-Bock: Average price for a condominium is 682,543. So Toronto is slowing slightly higher than that

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Nico James-Bock: passing to York region.

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Nico James-Bock: York region has a slightly higher average sale price at 1,315,352. This is down slightly 2.7% year to date, but still over a million. 3

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Nico James-Bock: York region consistently shows average selling price over a million 3 that has been consistent over the last 6 months, 5.6 4 months of inventory. So, creeping upwards in the months of inventory as we pass to York region, so condo sales up an impressive 14.7%,

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Nico James-Bock: only 187 transactions, with an average price down slightly at 673,143. This is, again another reflection of the high inventory and sluggish market conditions in the Condo sector.

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Nico James-Bock: Passing to Oakville, Oakville has the highest average selling price at 1,525,370. It's considered one of the most expensive regions when taken. Considering all housing types.

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Nico James-Bock: The sale price is down a mere 1.4% year to date. So not down too much. That average sale price 5.8 2 months of inventory. So almost 6 months of inventory

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Nico James-Bock: in the Oakville market. So we're seeing throughout all the regions, with the exception of Durham, that we're hovering just around just under 6 months of inventory in all regions, and that is quite high. It's tending towards

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Nico James-Bock: a buyer's market when we see numbers like that. But still the numbers can be a little bit deceiving, because in a lot of the pockets, Macro, and micro, we're really more in a balanced market condition with conditions neither favoring the buyer or the seller, or evenly balanced conditions favoring both both sides.

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Nico James-Bock: Condo sales are up in Oakville, an impressive 18 and a half percent, but translating to only 32 transactions with an average price down slightly at 684,072. So we're just in the in the Condo market. We're roughly around 700,000, let's say as an average price and

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Nico James-Bock: that is expected to edge upwards as the available inventory gets eaten up by all the newcomers that are coming into

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Nico James-Bock: into the Canada, but more specifically into the Gtha

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Nico James-Bock: newcomers tend to go 1st into the rental market, and then transition to most likely a condo, because that is, that tends to be the price point at which they feel more comfortable.

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Nico James-Bock: very few people are able to pay over a million dollars for their 1st home.

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Nico James-Bock: So all regions and submarkets are available on my social channels. So you can look at the other regions that I did not get to during this. Podcast so Mississauga, Brampton. But they're all there.

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Nico James-Bock: I want to point out that baby boomers are the biggest cohort that are holding on to their real estate. So that's 1 of part of a large part of the reason why we aren't seeing a lot of listings. Most the majority of homeowners are baby boomers. That's basically

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Nico James-Bock: what it comes down to when you look at the region on a regional level, and they're holding onto their real estate rightly so so as we see more newcomers coming into the Gta. There's going to be a lot of pressure

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Nico James-Bock: on available housing. So we're still in housing crisis, even though there's a large amount of predominantly condominium inventory sitting, and that's mostly because a lot of buyers are still on the sidelines waiting for more interest rate reductions.

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Nico James-Bock: Which will come. But the the amount of people that are pouring into the Gta, and then, and the the

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Nico James-Bock: the rapidity with which they are pouring into the city, that inventory that is sitting will get eaten up quite quickly, and that will put upward pressure on prices. So in the last 3 months we've seen more or less stagnation price, stagnation

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Nico James-Bock: that is going to change quite quickly as we move out of the winter months and start into spring of 2025. So the 1st quarter of 2025. We're going to see another shift in, particularly in prices.

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Nico James-Bock: There are

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Nico James-Bock: price, growth and market activity on a national average. Home price is forecast to rise by 9%.

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Nico James-Bock: Okay, year over year. In the 4th quarter of 2024. So those results will be more easily available or visible, let's say, in the 1st quarter of 2025, with strong price appreciation expected in regions like Greater Toronto, where prices could increase by 10%

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Nico James-Bock: supply and construction challenges. So, despite these positive price trends, housing supply remains a major concern. The Federal Government's recent measures to boost construction and address supply shortages will take time to materialize a lot of time and labor shortages in the construction industry continue to constrain new home development.

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Nico James-Bock: interest, rate. Uncertainty is another factor. While many hoped for rate cuts, expectations have shifted, and higher borrowing costs are still keeping some buyers on the sidelines.

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Nico James-Bock: However, a return to more balanced conditions is anticipated as rates eventually ease.

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Nico James-Bock: Speaking of rates, rates, the next Boc interest rate announcement.

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Nico James-Bock: Wednesday, October 23.rd in a couple of weeks less than a couple less than a couple of weeks actually, and Wednesday, December the 11, th when Wednesday, December 11, th will be the final interest rate. Announcement of 2024.

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Nico James-Bock: We're expecting those in the know.

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Nico James-Bock: more specifically, Sherry Cooper of the Dominion, lending centers as well as Sean Hildebrand from urbanation.

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Nico James-Bock: the economists are expecting there to be

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Nico James-Bock: more significant rate reduction at the next 2 announcements. So in the previous 3 announcements, we've seen 25 basis points

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Nico James-Bock: in the next 2.

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Nico James-Bock: We're anticipating 50 basis points at each announcement. So if that comes to pass, we will probably, we will probably see an interest rate an overnight overnight lending rate. At 3 and a half percent by the end of 2024. So at the December 11th

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Nico James-Bock: interest rate announcement.

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Nico James-Bock: Sunday, December 15.th The new mortgage rules kick in.

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Nico James-Bock: So there you have it. I hope this information has been helpful and useful, and that you can make better buying decisions, knowing that the changes that have taken place will be felt more significantly in the next few weeks.

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Nico James-Bock: That's it for this episode, and I will be in touch shortly with a new announcement, Ciao ciao.