A Summer Slowdown

In July, sales in the Toronto metro area declined to 5,995, down 11% month-over-month and 2% year-over-year, remaining 14% below the 10-year average. The decline was in line with the typical seasonal pattern, as sales volumes generally decrease from June through December.

New listings fell 16% month-over-month to 14,484 units in July, down 18% year-over-year and 2% below the 10-year average. The decrease was in line with the typical seasonal pattern, as listing volume generally declines from June through December.

Active inventory declined to 26,098 units in July, down 5% month-over-month, while remaining 14% lower year-over-year and 36% above the 10-year average. The decline was in line with the typical seasonal pattern, with active inventory generally decreasing from June through December.

In July, the market balance indicator, measured by months of inventory (MOI), edged up to 4.4, standing 44% above the 10-year average. However, on a seasonally adjusted basis, market balance strengthened. Historically, this level has been associated with annual price declines of approximately 6%. While condominiums continued to underperform the broader market, the gap between sectors narrowed.

Another market balance indicator, the sales-to-new listings ratio, rose to 0.41 in July, standing 13% below the 10-year average. Historically, a ratio at this level has been associated with annual price declines of approximately 9%.

In July, the benchmark price for a typical property declined 0.7% month-over-month to $934,600, with median and average prices also softening. Prices remained approximately 5% lower year-over-year and were still 25–29% below 2022 peak levels.

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In June, Toronto Metro’s rental market returned to a tightening trajectory after a temporary easing in May. The market balance indicator, rental months of inventory, declined to 1.51, standing 33% above the 10-year average. This shift aligns with the typical seasonal pattern, as rental market conditions generally strengthen between January and August.

In June, the average rent in the Toronto Metro climbed to $2,786, remaining 1.9% lower year-over-year and 11% below the 2023 peak. This increase aligns with the typical seasonal pattern, as rents generally rise from February through August.

New home sales rose to 1,175 units in June, though they remained 52% below the ten-year average. Over the past 12 months, a total of 7,463 units were sold, 69% below the historical norm.

In June, the high-rise benchmark price edged up to $1,038,604, remaining 1% higher year-over-year and 17% below its peak. Meanwhile, the low-rise benchmark price dropped significantly to $1,275,458, down 16% year-over-year and 34% below its peak. Such a steep decline, however, should be interpreted with caution.

In June, housing starts recorded a notable decline, falling to 2,132 units, 40% below the 10-year average. Over the past 12 months, total starts inched up to 26,737 units, 30% below long-term norms.

Housing completions declined sharply to 1,329 units in June, standing 42% below the 10-year average. The 12-month aggregate continued to soften, with 28,391 units completed, which is 19% below the historical average.

In July, the lowest five-year fixed mortgage rate edged up to 3.99%, while the lowest five-year variable rate increased to 3.35%, leaving the gap between the two unchanged at 0.64 percentage points.

Housing affordability in the Toronto metropolitan area remained unchanged in July, with mortgage payments on a newly purchased typical property continuing to consume 44% of median household income. It’s important to note that household income data were revised, resulting in a 1% increase across all recent values.

In June, Ontario’s unemployment rate held steady at 7.0%, marking a 10% year-over-year decline while remaining 3% above its 10-year average. Nationally, the unemployment rate eased to 6.5%, falling 1% below its long-term average. Meanwhile, Toronto’s rate declined to 7.2%, moving 5% below its 10-year baseline.

In April, Ontario’s mortgage arrears rate held steady at 0.31%, reflecting a 55% year-over-year increase and standing 160% above the 10-year average. Nationally, the rate remained at 0.28%, representing a 27% annual increase and staying 28% above the 10-year average.