Troubling headwinds persist in the GTA’s real estate market, as home sales were the lowest on record for a March in at least the last 23 years.
The spring market, which is typically when buyers return and sales trend upward, took a hit pointing toward a tough year ahead in what many experts were hoping would be a comeback for the real estate.
The current uncertainty with U.S. President Donald Trump’s tariff war and the upcoming federal election in Canada has buyers in a wait-and-see approach, according to the Toronto Regional Real Estate Board’s (TRREB) March report.
“If trade issues are solved or public policy choices help mitigate the impact of tariffs, home sales will likely increase,” said TRREB’s chief information officer Jason Mercer. “Home buyers need to feel their employment situation is solid before committing to monthly mortgage payments over the long term.”
Sales plummeted year over year by 23 per cent with just 5,011 sales in March, while new listings surged by almost 29 per cent to more than 17,000 listings.
The sales-to-new-listings ratio is 29 per cent, indicating a buyers’ market, meaning buyers have more negotiating power and choice.
Sales dropped significantly for all housing types with detached, semi-detached, townhomes and condos seeing year-over-year decreases of 25 per cent, 16 per cent, 23 per cent and 23.5 per cent, respectively.
The average sales price for all property types was down 2.5 per cent year over year to $1.09 million in March.
All property types saw marginal price decrease for detached, semi-detached, townhomes and condos seeing a year-over-year drop of 1.8 per cent, 0.9 per cent and 3.5 per cent, and 2.6 per cent drop, respectively.
Even though sales are taking a nosedive, home ownership in the GTA has become more affordable compared to the previous year due to interest rate cuts and easing prices, the report said, making monthly mortgage payments more manageable.
“Home ownership has become more affordable over the past 12 months, and we expect further rate cuts this spring,” said TRREB president Elechia Barry-Sproule. “Buyers will also benefit from increased choice, giving them greater negotiating power. Once consumers feel confident in the economy and their job security, home buying activity should improve.”
However, even as home ownership costs ease, consumer confidence will continue to take a hit, as all aspects of the real estate industry are impacted.
Canadian workers in industries threatened by U.S. tariffs could soon have a harder time qualifying for a mortgage, as one major bank has already restricted lending to self-employed workers and others are expected to make similar moves.
Trump’s tariffs have also made it more expensive to build and will delay construction, at a time when Canadians desperately need more housing.
