An Uneven Recovery

In October, sales in the Toronto metro area rose to 5,603 units, up 11% month-over-month but down 8% year-over-year, and 22% below the 10-year average. The monthly increase was consistent with typical seasonal patterns, as sales volumes historically declined from June through December, with a brief uptick in October.

New listings fell to 14,173 units in October, down 14% month-over-month and 12% lower year-over-year, moving to match the 10-year average. The decrease was in line with the typical seasonal pattern, as listing volumes generally trend downward from June through December.

In October, active listings fell 4% month-over-month to 25,098 units. They remained 10% lower year-over-year but stood 33% above the 10-year average. This decrease aligned with typical seasonal patterns, as inventory historically declined from June through December.

The market balance indicator, measured by months of inventory (MOI), declined to 4.5 in October, remaining 55% above the long-term average. Historically, this level has been associated with annual price declines of approximately 6%.

Another market balance indicator, the sales-to-new-listings ratio, increased to 0.40 in October but remained 22% below the 10-year average. Historically, a ratio at this level has been associated with annual price declines of approximately 10%.

In October, the benchmark price for a typical property declined 0.1% month-over-month to $916,400. Meanwhile, the average selling price edged higher, while the median price remained unchanged. Prices were 3-4% lower year-over-year and 23-29% below their respective peak levels.

Toronto Metro rental active inventory rose to 12,217 units in September, representing a 2% month-over-month increase but a 17% year-over-year decline. Rental inventory generally decreases through the third quarter.

In September, the average rent in the Toronto Metro edged down to $2,556, declining 1.5% year-over-year and standing 15% below its 2023 peak. This shift aligned with typical seasonal trends, where rents traditionally softened from September through January.

New home sales rose to 949 units in September, yet the gap relative to the historical 10-year average deepened to 52%. The 12-month total increased to 9,240 units but it remained 62% below the historical average.

In September, the benchmark price for new high-rise units declined to $1,031,574, unchanged year-over-year and 18% below its peak. Meanwhile, the benchmark price for new low-rise units fell to $1,246,764, down 13% year-over-year and 36% below its peak.

In September, housing starts increased to 1,440 units, 57% below the 10-year average. Over the past 12 months, total starts declined further to 23,355 units, 38% below long-term norms.

Housing completions surged to 4,766 units in September, shifting sharply to 61% above the 10-year average. The trailing 12-month total also climbed to 26,691 units, though it remained 24% below historical levels.

In October, the lowest five-year fixed mortgage rate rose to 4.44% and the lowest five-year variable rate climbed to 3.50%. The spread between the two rates narrowed to 0.94 percentage points.

Toronto’s housing affordability worsened in October as mortgage payments on a typical home rose to 43% of median household income, up from 42% the previous month.

Ontario’s unemployment rate edged up to 7.0% in September, 11% lower than a year earlier while remaining 3% above its 10-year average. Nationally, the unemployment rate rose to 6.5%, standing 1% below its long-term average. Meanwhile, Toronto’s rate increased to 6.9%, moving 9% below its historical levels.

In July, Ontario’s mortgage arrears rate rose to 0.34%, reflecting a 55% year-over-year increase and towering 174% above the 10-year average. Nationally, the rate edged up to 0.29%, representing a 26% annual increase and remaining 33% above historical levels.