The Toronto Regional Board of Realtors says August sales were down 34 per cent from last year, but up almost 15 per cent from July as buyers returned to the market to take advantage of prices that have fallen from the highs of winter.
The board said on Friday that sales for the month totaled 5,627 compared with 8,549 last August and 4,900 in July 2022.
The 34 percent year-on-year drop was a slower rate of decline than the previous four months, but comes at a time when the region’s property market has cooled significantly from the heatwave conditions seen at the start of the year.
Rising interest and mortgage rates in recent months have put a damper on sales and started to weigh on prices, ending bidding wars and encouraging would-be buyers to sit on the sidelines and wait for bigger price cuts.
Those who got into the market in recent weeks found that prices were lower than those seen in the frenetic winter months, but still higher than they were a year or even a month ago.
On a year-over-year basis, the home price index rose 8.9 percent, and the median sales price for all home types combined rose 0.9 percent to $1,079,500. However, the index was lower compared to July.
The seasonally adjusted median sales price was $1,130,463, up about two percent month-over-month, but down about 12 percent from $1,285,129, when the area saw its highest median price in the past 12 months.
The monthly increase in median price alongside the index’s decline suggests a larger share of more expensive types of homes sold in August, the TRREB said.
New listings last month totaled 10,537, down less than one percent from 10,615 last August.
The board also used the monthly real estate report to call for policy changes.
The council wants the Office of the Superintendent of Financial Institutions to consider scrapping the stress test for existing mortgage holders who want to shop around for the best possible rate when renewing rather than forcing them to stay with their existing lender to avoid stress test.
The stress test sets the interest rate on unsecured mortgages at either two percentage points above the contract rate or 5.25 percent, whichever is greater.
“There is room for the federal government to provide greater housing affordability for existing homeowners by removing the stress test when existing mortgages are switched to a new lender, allowing for more competition in the mortgage market,” said Kevin Crigger, president of TRREB. a liberation.
“Furthermore, allowing longer amortization periods for mortgage renewals would help today’s homeowners in an inflationary environment where day-to-day costs have risen dramatically.”
This report by The Canadian Press was first published on September 2, 2022.
