Interest rates, economic uncertainity lead to flat housing sales from Oshawa to Burlington

Higher borrowing costs, continued uncertainty about the economy and the Bank of Canada’s interest rates and the constrained supply of listings resulted in fewer home sales in August 2023 compared to last year, though the blow was softened somewhat in Durham Region.

The average selling price remained virtually unchanged over the same period. On a seasonally adjusted monthly basis, sales and average price edged lower.

“Looking forward, we know there will be solid demand for housing – both ownership and rental – in the Greater Toronto Area and broader Greater Golden Horseshoe. Record immigration levels alone will assure this. In the short term, we will likely continue to see some volatility in terms of sales and home prices, as buyers and sellers wait for more certainty on the direction of borrowing costs and the overall economy,” said TRREB President Paul Baron.

Greater Toronto Area realtors reported 5,294 sales in August 2023 – down by 5.2 per cent compared to August 2022. In Durham Region the numbers were down 3.7 per cent in August from the previous year, with 776 sales last month vs 806 in August 2022.

New listings were up by 16.2 per cent year-over-year in the GTA, providing some relief on the supply front, but year-to-date listings are still down substantially compared to the same period last year. Seasonally adjusted sales were down slightly by one per cent month-over-month compared to July 2023, while new listings were up by 1.3 per cent compared to July.

“More balanced market conditions this summer compared to the tighter spring market resulted in selling prices hovering at last year’s levels and dipping slightly compared to July. As interest rates continued to increase in May, after a pause in the winter and early spring, many buyers have had to adjust their offers in order to qualify for higher monthly payments. Not all sellers have chosen to take lower than expected selling prices, resulting in fewer sales,” said TRREB Chief Market Analyst Jason Mercer.

Single family homes are what’s being sold in Durham right now, especially in Oshawa, which was responsible for nearly a third (243) and the total number of home sales in the region last month.

Oshawa also leads in sales year-to-date, with the city responsible for 1,752 of the total sales so far in 2023 of 6,253. Whitby (1,152) and Clarington (1,121) follow.

The average selling price for homes sales in the GTA in August was up marginally (less than one per cent) but Durham did a bit better than that, rising 2.7 per cent. That number still trailed Halton (4.58 per cent) and York (5.32 per cent).

Average sale prices in Durham ranged from $1,228,915 in Uxbridge to $815,098 in Oshawa.

“While higher interest rates have certainly impacted affordability, the prospect of higher taxes will also hit households’ balance sheets, especially younger buyers with limited savings. With the City of Toronto moving to raise the municipal land transfer tax rate on properties over $3 million as a revenue tool, it must also consider helping first-time home buyers struggling to enter the market by adjusting their tax rebate threshold to reflect today’s higher home prices,” said TRREB CEO John DiMichele.

\