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In June 2024, the Greater Toronto Area (GTA) housing market failed to rebound as anticipated following the Bank of Canada's interest rate cut earlier in the month. Data from the Toronto Regional Real Estate Board (TRREB) revealed a notable decline in home sales compared to the previous year, with only 6,213 transactions recorded via the MLS® System. This figure marked a significant 16.4% decrease from June 2023, when 7,429 homes were sold.
The majority of transactions in June were concentrated in detached homes, comprising 2,988 sales, while townhouses, condo apartments, and semi-detached homes followed with 1,054, 1,520, and 599 sales, respectively. Despite the rate cut providing initial relief, TRREB President Jennifer Pearce noted that many prospective buyers remained cautious, keeping their purchasing decisions on hold, indicating a preference for further rate reductions before committing.
Looking ahead, the timing of future rate cuts remains uncertain amid economic indicators. Statistics Canada reported a 2.9% year-over-year increase in the Consumer Price Index for May, slightly up from April, prompting mixed opinions among economists regarding the likelihood of another rate cut in the near term. Pearce highlighted that TRREB's polling suggested substantial rate cuts, totaling 100 basis points or more, would be necessary to significantly stimulate home sales in the region.
Despite the subdued sales, the GTA market maintained a healthy supply of homes, with 17,964 new listings, up by 12.3% compared to the previous year. Additionally, while the MLS® Home Price Index Composite benchmark dipped by 4.6% year-over-year, the average selling price of $1,162,167 represented a marginal decrease from the previous year, indicating stable pricing trends amidst increased inventory levels. As sales activity potentially picks up with lower borrowing costs, the market dynamics are expected to balance with ample supply moderating any rapid price increases moving forward.
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