A troubling report shows declines across the board in the Greater Toronto Area (GTA) housing market, as experts use words like "adjustment" to describe the sudden deflation of a bloated market in the face of historic inflation and higher borrowing costs.
The Toronto Regional Real Estate Board (TRREB) reports 5,038 sales in the region in September, marking a 44.1 per cent tailspin from the same period last year.
Listings were also down, but the decline was nowhere near as drastic, with a year-over-year drop of 16.7 per cent to 11,237. Still, this figure is the single-lowest number of new listings in any September since 2002, marking a 20-year low.
This has experts just as worried as the even greater drop in sales, with TRREB calling the slip "especially troublesome given that the stock of homes in the GTA increased markedly over the last 20 years."
"We must ensure that the temporary dip in housing demand is not allowed to mask the critical shortage of homes available for sale in the GTA," said TRREB President Kevin Crigger.
"Municipal council decisions have a direct impact on housing affordability, in terms of the protracted development approval processes, high development fees and other related policies that preclude timely housing development."
And the general public appears to agree with TRREB. A recent poll conducted by Ipsos Public Affairs found 71 per cent of GTA regions residents believe that municipalities should focus their efforts on increasing the supply of homes for sale and rent.
TRREB CEO John DiMichele puts pressure on elected councils in GTA municipalities to "reconsider existing policies that preclude homeowners from listing their homes for sale, including significant added upfront costs like the land transfer tax."
"Potential new policies like mandatory home energy audits could also create unnecessary interference and delays in the home selling process and dissuade some homeowners from listing their homes for sale."
DiMichele argues that "If councils continue to support policies that restrict new home development and existing home listings, such as exclusionary zoning, housing affordability will be severely hampered over the long term, which will also hamper our region's future growth."
Despite massive increases in the cost of living in the region, home prices are probably among the few areas where prices are actually dropping, at least by some metrics.
The average price GTA-wide dropped by 4.3 per cent year-over-year to $1,086,762, though this figure represents an increase over August 2022 prices.
"Hovering just below $1.1 million, the average selling price may have found some support during the last couple months of summer," said TRREB Chief Market Analyst Jason Mercer.
It now costs an average of $1,061,876 to buy a home in the 416, down from $1,090,422 during the same period last year. In the 905, prices dropped from $1,161,895 in Sept. 2021 to $1,099,938 in Sept. 2022.
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