December 2023 - Worst Year For Sales Since 2001
Well, 2023 really was a miserable year for real estate sales in Toronto and the GTA. The last year annual sales were lower was in 2001, 22 years ago.
We had a 'not-so-bad' start to the year but, starting in June, after the Bank of Canada started raising rates again, sales started dropping off and listing inventory started increasing dramatically.
As we enter 2024, we're seeing a slight decline in the benchmark 5-year fixed rate, down from the high 5's to 5.14% most recently. The expectation is that, if inflation is contained, we'll see further drops in the late spring to early summer time frame.
For most of the last 13 years, the Bank of Canada prime rate shifted up and down between 3% to 4%, compared to our current prime at 7.2% so we do have a way to go to get back to 'normal'.
The 2024 market expectation looks better for detached and semi-detached houses since additional new inventory of those homes is basically non-existent.
However, new condo construction completions this year will likely result in an inventory increase on the resale market as our higher interest rates don't make them as attractive an investment compared to what those suites can now rent for.
Thomas
DECEMBER 2023 Toronto Real Estate Market Report
Here’s a ‘highlights’ summary of the significant real estate milestones across the entire Toronto Real Estate Board territory and in the City of Toronto specifically for DECEMBER 2023 as we finish off last year’s real estate market reports.
Across the entire TRREB Board, DECEMBER sales (3,444) were +10% above last year and were the 2nd lowest for the month since the year 1999
Active Listings (10,370) however were +19% above those in December 2022
The ratio of sales-to-listings was up slightly at 33% in December – in a ‘neutral’ or slight buyer market territory
The December average sale price came in at $1,084,692– basically flat over the last 10 months (the average for 2023 is $1,126,604) and up 3.2% compared to one year ago
The GTA real estate market ‘velocity’ overall slowed to 32 days-on-market
Detached home sales in December 2023 with a purchase price over $2,000,000 were up by +10% (179 houses) while condo apartment sales over $2M were down by -27% (11 suites) compared to December 2022
The CONDO townhouse / highrise share of the overall market was steady at 35% during the month and all condo-type sales (1,198) dropped by -2% from 2022
In the City of Toronto only, detached house sales (371) increased by +20% from 2022 while the average detached sale price ($1,626,980) was basically flat from a year ago
Similarly, December Toronto semi-detached sales (128) were up by +54% year-over-year while the average semi sale price ($1,173,171) increased by 2%
Downtown condo active listing numbers were up big time… an increase of 24% in C01 and by 63% in C08 from last year
December year-over-year downtown condo sales increased in C01 (+3%) and were lower in C08 (-11%) compared to 2022 with 3-month rolling average Y-O-Y sale prices showing declines of -7% in C01 and -4% in C08
The downtown condo days-on-market average slowed to between 35 & 37 days in both C01 and C08
The December ratio of sales-to-listings for high-rise condos downtown remained steady in buyer market territory in both C01 (19%) and in C08 (15%), defined mainly by the huge increase in condo suite inventories
In the 905 districts, December saw average detached home prices up +3% compared to 2022 while condo apartment prices in the 905 districts were lower by -1.2% compared to last year. Sales here showed contrasts (+11% houses / -5% condos) from one year ago
In most of our previous Toronto / GTA market downturns, the house market recovered prior to the condo one as it seems it might be happening now.
Thomas@LivingInToronto.com
647-962-1650