Toronto Real Estate Update: From Summer Slowdown to Fall Moves
In this report, we'll be breaking down the August stats provided by the Toronto Regional Real Estate Board (TRREB). They are specifically for the City of Toronto which includes Etobicoke, Central Toronto, North York, East York and Scarborough.
As we dive into September, we're right there with you—juggling back-to-school schedules, work commitments, and the overall chaos that comes with this time of year.
This season of new beginnings often leads to rethinking priorities, whether that’s making room for more space or just keeping an eye on the real estate market.
Let's take a look at what August had in store for the Toronto market and what that could mean for your home plans as we head into the fall.
Since our last market update in June, the Bank of Canada lowered the policy rate twice—each time by 25 basis points—the current rate now sits at 4.25%. This has brought some much-needed relief to borrowers, with the possibility of further cuts on the horizon.
“The Bank of Canada’s rate cut announced on September 4 will lead to a further improvement in affordability, especially for those using variable rate mortgages. First-time buyers are especially sensitive to changes in borrowing costs. As mortgage rates continue to trend lower this year and next, we should experience an uptick in first-time buying activity, including in the condo market,” said Toronto Regional Real Estate Board (TRREB) President Jennifer Pearce
August is historically a slower month for real estate, and that seasonal slowdown is reflected in the month-over-month price drop from July. The average sale price in August 2024 came in at $1,029,069, down from $1,087,436 in July. This dip isn’t unusual—it aligns with the typical summer market cool-down, when both buyers and sellers often pause for vacations and back-to-school preparations.
However, when we look at the year-over-year change, we see a 2.3% increase from $1,005,945 in August 2023. This annual growth tells a different story, highlighting that despite short-term fluctuations, property values have been steadily appreciating over the past year.
The balance between the seasonal month-over-month decline and the steady year-over-year growth shows that while short-term dips may occur, the broader trend is one of long-term value appreciation. This is particularly important for those considering a longer-term move, as it demonstrates the market’s strength over time despite typical seasonal variations.
In terms of sales activity, there were 1,718 transactions in August 2024, down 9.1% from the 1,891 sales recorded in August 2023. This trend reflects a quieter market, as sales in August traditionally slow down after the busy spring and early summer months. However, the year-over-year change isn’t drastic, and demand remains relatively strong in the grand scheme of things.
New listings came in at 4,177, which is a minor decrease of 3.5% year-over-year, but a significant drop from the 6,074 new listings in July 2024. This drop in listings mirrors the typical late summer slowdown we saw with sales, as the market temporarily cools before activity picks up again in the fall. The tighter supply during August helps maintain price stability, even when sales volumes decline, as fewer homes on the market keep competition among buyers relatively steady.
Understanding key real estate market metrics: sales-to-new-listing ratio, days on market, and months of inventory:
The sales-to-new-listing ratio (SNLR) tells us how many of the newly listed properties are being sold in a certain time frame. If the ratio is around 50%, it means the market is balanced. But if it goes above 60%, that's when we start to see a seller's market, where prices tend to rise. So, the higher the ratio, the better it is for sellers and the more competitive the market becomes for buyers.
The average days on market (DOM) refers to the average amount of time that it takes for a property to be sold after it is listed for sale. This can be a useful metric for understanding how quickly homes are being snapped up in a particular area.
Lastly, the months of inventory (MOI) is a measure of the amount of time it would take for all of the currently listed properties to be sold, based on the current rate of sales. It's a useful metric for understanding how much supply there is relative to demand in a particular area. For example, if there are 100 properties currently listed for sale and 20 of them are sold each month, it would take 5 months to sell all of the properties (100 / 20 = 5).
The sales-to-new-listings ratio (SNLR) stood at 37.6% in August 2024, down from 49.3% in August 2023. This tells us that the market is leaning more towards a buyer's market than it was last year, with fewer sales relative to the number of listings coming to market.
Days on market (LDOM) also jumped to 30 days in August, which is a 42.9% increase compared to last year. Homes are taking longer to sell, reflecting more cautious buyer behaviour or sellers holding firm on their asking prices. This is supported by the months of inventory, which rose to 3.7 months, a significant jump from 2.4 months last year—further indicating a shift towards a buyer-favoured market.
“As borrowing costs trend lower over the next year-and-a-half, home buyers will initially benefit from both lower monthly mortgage payments and lower home prices. Even as demand picks up, especially in 2025, it will take time for the inventory of listings to be absorbed. Ample choice in the market will help keep price growth moderate, at least in the initial phases of recovery,” said TRREB Chief Market Analyst Jason Mercer.
To wrap up, it's important to remember that Toronto is a city of micro-markets, where performance can vary significantly based on the neighbourhood and type of home. While citywide numbers give us a general sense of trends, the reality on the ground is often quite different depending on location.
For example, detached and semi-detached homes in high-demand areas may continue to see strong price appreciation, while condo markets in more saturated neighbourhoods might experience softer pricing. Similarly, some neighbourhoods with limited inventory might still see competitive bidding, whereas others could be experiencing a cooling effect with more balanced conditions.
This variability underscores the importance of taking a hyper-local approach when considering buying or selling. Whether you’re looking to enter the market, upgrade, or downsize, the dynamics can shift from one pocket of the city to the next, and from one home type to another. Staying informed and working with a knowledgeable team can help you navigate these nuances and make the best decisions for your real estate needs.
If you have any questions or would like more information on recent home sales in your specific neighbourhood, don't hesitate to connect with us here.