In a promising turn of events for the Greater Toronto real estate market, home sales experienced an 11.5 percent increase last month compared to December 2022. The Toronto Regional Real Estate Board (TRREB) anticipates a rebound in activity throughout 2024, aiming to recover from a challenging year marked by unaffordability.
December's robust performance contributed to a total of 3,444 home sales, bringing the annual tally to 65,982. Despite the yearly decline of 12.1 percent compared to 2022, the recent surge offers optimism for a market that faced a slowdown due to high mortgage rates, sidelining many potential buyers.
The average home price at the end of the year reached $1,084,692, indicating a 3.2 percent increase from December 2022. TRREB president Jennifer Pearce highlighted the challenges faced in 2023, stating, “High borrowing costs coupled with unrealistic federal mortgage qualification standards resulted in an unaffordable home ownership market for many households in 2023.”
However, Pearce expressed hope for the future, stating, “With that said, relief seems to be on the horizon. Borrowing costs are expected to trend lower in 2024. Lower mortgage rates coupled with a relatively resilient economy should see a rebound in home sales this year.”
The positive momentum was widespread across Greater Toronto, with December sales rising on a yearly basis in all categories except for condo apartments, which experienced a modest 1.4 percent decline. Semi-detached homes emerged as the frontrunners for gains in the region, boasting a significant 36.7 percent increase in sales for the month, closely followed by townhouses at 19.8 percent.
In the City of Toronto, there were 1,266 sales last month, reflecting a notable 10.1 percent jump compared to the same period in 2022. The rest of the Greater Toronto Area (GTA) also witnessed a surge, with home sales rising by 12.3 percent to reach 2,178.
While the number of new listings fell by 6.6 percent to 3,886 in December compared with the previous year's 4,161, the TRREB remains optimistic about the market dynamics. Chief market analyst Jason Mercer emphasized the benefits for those participating in the market last year, noting that increased choice allowed many buyers to negotiate lower selling prices.
"Assuming borrowing costs trend lower this year, look for tighter market conditions to prompt renewed price growth in the months ahead," Mercer added, hinting at a potential shift in market dynamics as we move into 2024.
As the Greater Toronto real estate market navigates through changing economic conditions, the recent surge in home sales and the anticipated decline in borrowing costs set a positive tone for the year ahead, offering hope for prospective homebuyers and sellers alike.
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