May Real Estate Market Update

May home sales continued at low levels, especially compared to last spring’s short-lived pick-up in market activity. Home buyers are still waiting for relief on the mortgage rate front. Existing homeowners anticipate an uptick in demand, as evidenced by a year-over-year increase in new listings.

With more choices than a year ago, buyers benefitted from more negotiating room on prices. “Recent polling from Ipsos indicates that home buyers are waiting for clear signs of declining mortgage rates. As borrowing costs decrease over the next 18 months, more buyers, including many first-time buyers, are expected to enter the market. This will open up much-needed space in a relatively tight rental market,” stated < Toronto Regional Real Estate Board (TRREB) President Jennifer Pearce.

Greater Toronto Area REALTORS® reported 7,013 home sales through TRREB’s MLS® System in May 2024 – a 21.7 percent decline compared to 8,960 sales reported in May 2023. New listings entered into the MLS® System amounted to 18,612—up by 21.1 percent year-over-year. The MLS® Home Price Index Composite benchmark was down by 3.5 percent year-over-year in May 2024. The average selling price of $1,165,691 was down by 2.5 percent over the May 2023 result of $1,195,409.

On a seasonally adjusted monthly basis, the average selling price increased slightly compared to April 2024. “While interest rates remained high in May, home buyers continued to benefit from slightly lower selling prices than last year. We have seen selling prices adjust to mitigate the impact of higher mortgage rates. Affordability is expected to improve further as borrowing costs trend lower. However, as demand picks up, we will likely see renewed upward pressure on home prices as buyer competition increases,” said TRREB Chief Market Analyst Jason Mercer.

“To have an affordable and livable region over the long term, we need to see a coordinated effort from all levels of government to alleviate our current housing deficit and to provide housing for new population moving forward. On top of this, governments need to ensure infrastructure delivery to support our growing population. The economic health and liveability of our region depends on the timely completion of public transit projects, which include better transparency and clear timelines on the Eglinton Crosstown LRT,” said TRREB CEO John DiMichele.

Until next time and don’t forget I am always here to help!