Prospective homebuyers saw clear signs of a cooling Toronto market in April as the region’s real estate board reported sales dropped by about 41 per cent since last year and 27 per cent in one month.
The Toronto Regional Real Estate Board (TRREB) said Wednesday that April sales amounted to 8,008 across the region, down from 13,613 during the same month last year and 10,939 in March.
The board attributed much of the decline to homebuyers who are taking a break from the market as interest rates climb and reduce their buying power.
“It certainly appears that the Bank of Canada is achieving its goal of slowing consumer spending as it fights high inflation,” TRREB President Kevin Crigger said in a release.
“Negotiated mortgage rates rose sharply over the past four weeks, prompting some buyers to delay their purchase.”
The year-over-year decline in sales was greatest in the area surrounding Toronto known as the 905 and was particularly apparent in the detached housing category, the board said.
Sales of detached homes in the 905 totalled 2,732, a more than 47 per cent plunge from the year before, while the market’s 1,033 townhouse sales amounted to a 44 per cent drop. There were 491 sales of semi-detached homes in the 905 last month, a 40 per cent fall from the year before, and the 685 condo sales decreased by roughly 32 per cent.
April detached home sales in the City of Toronto, which is linked to the 416 area code, reached 868, a 34 per cent drop from a year before, and semi-detached home sales fell 26 per cent to 311. Townhouse sales for the month amounted to 335, a 42 per cent fall from the same month a year earlier, while 1,488 condos sold in April, down 35 per cent from the same month in 2021.
The drops in sales also weighed on home prices, which have been climbing steadily for much of the COVID-19 pandemic and were often fuelled by bidding wars and intense competition.
April’s average home price for the Greater Toronto Area reached more than $1.2 million, down from about $1.3 million the month before.
However, April’s average price was still up by about 15 per cent from the year before, when the average price was more than $1 million.
“It is anticipated that there will be enough competition between buyers to support continued price growth relative to 2021, but the annual pace of growth will moderate in the coming months,” said Jason Mercer, TRREB’s chief market analyst, in a release.
TRREB will also be watching supply closely, after buyers and brokers spent the start of the year bemoaning a lack of listings and predicting that the spring market would turn things around.
April’s new listings dropped by about 12 per cent to 18,413 from 20,841 during the same month the year before, TRREB found.