Bank of Canada Cuts Rates: What Buyers and Sellers Should Know This Fall
In this report, we'll be breaking down the September 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.
With the fall season in full swing, the Bank of Canada has lowered its key interest rate by 50 basis points to 3.75%, with the next announcement scheduled for December 11, 2024.
For buyers, this rate cut means more affordability and potential savings, making it an opportune time to consider a move before demand increases further. With a significant influx of new inventory hitting the market, there’s still room to negotiate—at least for now.
For sellers, this shift may generate a boost in demand, especially heading into late fall. However, pricing strategically remains crucial, as buyers are still cautious. With more inventory available, presenting your property well and aligning with current market expectations will be key to standing out.
If the Bank of Canada signals another cut in December, we may see even more activity heading into early 2025. For now, staying informed, flexible, and ready to act—whether you’re buying or selling—will help you make the most of these shifting conditions.
While the rate cut gives us a glimpse of what’s to come, we still have a lot to learn from the September numbers—even as we approach the next data release from the Toronto Regional Real Estate Board in early November. Understanding the trends from last month helps us see where the market stands right now—and how best to move forward.
September brought higher prices month-over-month, a surge in new listings, and a steady increase in sales activity—albeit still at relatively low levels—giving both buyers and sellers plenty to think about.
The September numbers paint a picture of both opportunity and challenges—where buyers are starting to move, and sellers have a window to act before year-end slowdowns. The question is, how do you position yourself to make the most of it?
Let’s dive into the data and see what these shifts in price, sales, and new listings mean—and how they could shape the rest of the fall market.
The slight 0.5% decline year-over-year suggests that prices are holding steady despite earlier downward pressure from high borrowing costs. However, the 8.2% month-over-month rise shows that September brought a renewed sense of optimism and stabilization after the quieter summer months.
For buyers, timing matters. While prices remain slightly below last year, the recent month-over-month increase suggests the window for finding deals could be narrowing. With the recent Bank of Canada rate cut, prices may start trending upward. Taking advantage of higher inventory and relatively low sales levels now could offer the best opportunities before market conditions shift.
For sellers, price smart to attract offers. Buyers are still price-sensitive. Although prices rose month-over-month, buyers have plenty of options and aren’t rushing into overpaying. Overpricing could lead to your property sitting on the market longer than expected, making it essential to find the right balance between value and appeal.
Sales are climbing steadily, up 3.7% year-over-year and 5.2% month-over-month. However, the pace of sales remains moderate, reflecting a cautious but active buying environment. As sales increase, buyers may face more competition for well-priced homes.
If you find a property that fits your needs, acting quickly will be essential, as the most appealing homes are moving faster. However, there’s still room to negotiate—particularly on listings that have been on the market for a while.
The recent rate cut could further boost sales in the coming months, as lower borrowing costs encourage more buyers to enter the market. Absorbing the influx of new listings will depend on this increased buyer activity, making the next few months crucial in determining the market’s direction.
“As buyers take advantage of changes to mortgage lending guidelines and borrowing costs trend lower, home sales will steadily increase in relation to population growth. With every rate cut, a growing number of GTA households will afford a long-term investment in home ownership, including first-time buyers,” said Toronto Regional Real Estate Board (TRREB) President Jennifer Pearce.
The sharp 69.3% month-over-month increase in new listings signals that sellers are taking advantage of the fall market.
More inventory = more options for buyers. This creates opportunities for those looking to negotiate or find homes without intense bidding wars. As new listings accumulate, buyers might have leverage over sellers looking to close quickly, especially before the holidays.
For sellers, standing out is crucial. With so many new listings on the market, competition among sellers is increasing. Pricing accurately and presenting well will be the key to capturing buyer interest.
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-listing ratio at 37.4% suggests that while there are buyers in the market, it remains competitive for sellers. A ratio below 40% signals a more buyer-friendly market, where only well-priced listings that tick all the right boxes tend to move quickly.
On average, homes are spending 27 days on market, meaning serious sellers need to position their homes competitively to attract attention. However, 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.
This market offers buyers a sweet spot, with inventory climbing to 3.8 months of supply. This balance gives buyers more breathing room, but with interest rate adjustments from the Bank of Canada, timing will be key.
Waiting too long could mean entering a busier market, as the recent rate drop may drive increased competition. If you’re looking to buy, now is a great time to act while inventory is higher and sellers are motivated.
With fewer bidding wars, buyers have room to negotiate, especially for condos and townhouses that are showing softer price trends.
In today’s market, timing and strategy are everything. Buyers, the current conditions offer more negotiating power—but waiting could mean more competition down the line. Sellers, this is the moment to price smart, market well, and stand out.
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.