The Bibby Group | September Newsletter

With Labour Day behind us, higher borrowing costs and continued uncertainty with the Bank of Canada’s decision-making have headlined the start of our fall market. With ten interest rate hikes in 18 months and the latest announcement behind us with a hold, the focus has now shifted from interest rates to closely monitoring increasing supply levels. The end of the summer experienced its seasonal cool down of transactions, however, with average sale prices edging lower on a seasonally adjusted monthly basis. It almost feels like we are reliving the start of the September 2022 market.

In its latest Market Watch report, The Toronto Real Estate Board noted that sales are down from the same time last year by approximately 5.2%, while inventory levels have increased by 16.2%. For active buyers, there appears to be some fantastic opportunities. As more balanced conditions emerged throughout the summer compared to a peak spring market, buyers have had to adjust their budgets or offers due to rising rates and higher carrying costs. Noticeably, prices may be slightly up from this time last year. However, there is data suggesting that, in some cases, they are down by 5% to 8% (and even 10%) from the spring of 2023. That being said, not all sellers are willing to adjust their expectations. Case in point: I have had many would-be sellers postpone sales to a future date or opt to lease their properties out, which has continued to safeguard pricing. Any acceleration in the volume of new listings could put additional pressure on the average price of property in the months ahead.

As some buyers have retreated to watchful and strategic positions, timing the market perfectly has always proved futile and challenging. In many cases, you end up settling, as most properties that check an above-average number of boxes will still trade productively under subpar conditions—or the property owners will simply wait and be patient. And while prices have declined in recent months, I’m not convinced that a severe housing correction in the central Toronto markets will occur in the months ahead.

To conclude, buyers and sellers will need to find common ground to get transactions completed. And while the market’s softening could be a welcome sign for buyers, I applaud the discipline, endurance, and creativity of the many Toronto homeowners who have endured a lengthy and more arduous selling experience.