February Market Watch: Homebuyers continued to benefit from substantial choice in the Greater Toronto Area (GTA) resale market in February 2025.

As we move into the spring market, the February 2025 housing data from TRREB highlights a market in transition. While sales activity showed a modest month-over-month increase, year-over-year figures remain significantly lower. Interest rate shifts, buyer sentiment, and a glut of condo inventory continue to shape market conditions across the Greater Toronto Area.

Market Dynamics

• Total Sales: The GTA saw sales dip year-over-year to 4,037 (-27.4% YoY, +4.9% MoM)

• Average Selling Price: Selling Prices remained relatively stable averaging $1,084,547 (-4.1% YoY, +1.2% MoM)

• New Listings: February saw new listings grow year over-year up 5.4% to 12,066 and down 2.6% from January.

• Active Listings: Inventory remains significantly elevated, with year-over-year growth in available properties up 76% and 13.9% above January.

• Days on Market:

  • Listing DOM: Listings sell on average in 28 days (+12.0% YoY, -24.3% MoM)

  • Property DOM: Listings that terminate and re-list are on for 43 days (+16.2% YoY, -21.8% MoM)

What's happening locally? Toronto Market Insights

Interest Rate & Mortgage Trends

The Bank of Canada (BoC) initiated its first rate cut of the year in January, bringing the policy rate down to 3.00%, and another cut to 2.75% is anticipated in March. This shift is a response to slowing economic activity and declining inflation. Lower borrowing costs are beginning to make homeownership more accessible for some buyers, particularly those considering variable-rate mortgages.

Meanwhile, fixed mortgage rates have also seen downward pressure, reflecting declining 5-year bond yields. As the bond market anticipates further BoC rate cuts, we may see fixed-rate mortgages continue to decrease, offering buyers improved affordability.

Key Market Observations

1. Sales Remain Subdued, but Price Stability Emerges

   • While sales volumes are down significantly year-over-year, average prices are showing signs of stabilization. Month-over-month growth in pricing suggests some resilience in the market, particularly for well-priced freehold homes.

2. More Listings, Longer Selling Timelines

   • New listings continue to rise, contributing to a more balanced market. While sellers must be strategic with pricing, buyers have greater selection and negotiation power.

3. The Condo Market Faces Headwinds

   • In contrast to freehold properties, GTA condos continue to struggle with an oversupply of listings. With more than six months of inventory in some areas, the condo segment remains firmly in a buyer’s market, placing downward pressure on prices and extending selling timelines.

4. Economic Uncertainty from Trade War Looms

   • The ongoing trade war between the U.S. and Canada, particularly new tariffs on Canadian exports, has introduced economic uncertainty that could impact job markets and consumer confidence. While the full effect on housing remains unclear, uncertainty makes it difficult to predict long-term trends, keeping both buyers and sellers cautious.

What This Means for Buyers & Sellers

For Buyers:

• The market remains favourable for those looking to purchase, with more options and improving affordability as interest rates decline.

• Condos, in particular, offer strong negotiation opportunities due to elevated inventory levels.

• Well-priced properties in desirable areas are still attracting competition, so preparation and decisive action remain important.

For Sellers:

• While prices are showing some stability, strategic pricing and strong presentation are key to attracting serious buyers.

• Homes are taking longer to sell, meaning sellers should be prepared for extended timelines compared to previous years.

• Freehold properties continue to see steady demand, though pricing realistically in the current market is crucial.

Final Thoughts

The GTA real estate market is evolving as interest rates shift and inventory levels rebalance. While challenges persist, particularly in the condo segment, the broader market is adjusting to more balanced conditions. However, the uncertainty surrounding the ongoing trade war adds an additional layer of complexity, making it difficult to predict the long-term trajectory of housing demand.

As we enter the spring market, staying informed and working with experienced professionals will be key to making the right real estate decisions.

Thinking about buying or selling? Contact us today to navigate the market with confidence!

Call Ben at 905-995-23372

MORE MARKET INSIGHTS (All of Durham Region Markham/Stouffville & Port Hope/Cobourg)

Greetings, GTA homebuyers and sellers! As we step into June, it's time to reflect on the dynamic real estate landscape that unfolded throughout May 2024. Join us as we uncover the latest insights and trends from the past month, offering a clear perspective on what May's market stats mean for your real estate journey. At Jim Stanton & Associates, our commitment to providing you with valuable information remains steadfast. Let's explore together the opportunities and possibilities that await in the ever-evolving GTA market.

Market Summary: In May 2024, the GTA real estate market showed mixed signals:

• Sales Momentum: Compared to the same period last year, sales decreased by 21.7%. There was a month-over-month decrease of 1.42%.

• Listing Dynamics: New listings were up 21.1% from 2023 and 9.9% month-over-month.

• Active Listings: Active listings saw a significant increase, up 83.3% from 2023 and 20.3% from April 2024.

• Price Trends: The average price for homes was down 2.5% year-over-year but saw a slight increase of 0.8% month-over-month.

• Balanced Market: With 3 months of inventory available, the market was balanced.

• Time to Sell: Days on Market remained stable month-over-month.

Click here to view the TRREB Market Watch Report for May 2024

What's happening? Toronto Market Insights

Interest Rates

On June 5th, the Bank of Canada decreased its policy interest rate by 25 basis points. This is the first move since July 2023 and the first reduction since it began increasing the rate in March 2022 from its record low of 0.25%. The last time interest rates were lowered by the Bank of Canada was when the Bank dropped rates to an all-time low at the onset of the pandemic in March 2023.

What Does This Mean for Buyers and Sellers?

For Buyers:

Buyers are poised to benefit from the recent interest rate reduction, which is expected to increase buying power and push more buyers into the market. As a general rule of thumb, a ¼ point decrease in interest rates adds about $10,000 to the average borrower's buying power, though this depends on individual circumstances. However, with more buying power, competition is likely to heat up, especially for entry-level homes. Lower rates can be tempting, but remember that while waiting for further reductions, competition will likely increase. If you buy now, you pay today's prices and can always refinance at a lower rate later. Waiting might get you a lower rate, but you'll likely be paying a higher price.

For Sellers:

Luxury homes have been taking longer to sell in the higher interest rate environment. Hang in there; lower rates may bring more buyers. Expect competition to increase even more on entry-level homes like townhomes and links. These homes are always in demand, and these changes will only spur more competition. With rates finally starting to come down, now is the time to plan your next move. Information is power, and you only benefit by starting the process now.

Conclusion:

In conclusion, May 2024 witnessed a mix of trends in the GTA real estate market, presenting a balanced environment for both buyers and sellers alike. Despite fluctuations in sales compared to last year, there was a notable month-over-month decrease. The surge in new and active listings indicates a healthy influx of properties, while pricing trends remained relatively stable. With inventory levels maintaining a balance, the market is poised for potential changes depending on the upcoming interest rate adjustments. Looking ahead, proactive engagement will be key for both buyers and sellers to capitalize on emerging opportunities. At Jim Stanton & Associates, we're dedicated to providing the guidance and support necessary for navigating this dynamic landscape effectively.

Get the Help You Need:

Regardless of the statistics and the market, you have your own reasons for making a move. A big life event, ambitions, the need to upsize or downsize, or even relocate. The key is to ensure you have someone in your corner representing your best interests. Let us be your guide. Contact Us Today!

Call Ben at 905-995-3372