Evan Buhler/The Canadian Press
The Toronto-area real-estate market is heading into the fall with new listings in the pipeline and the likely return of sellers who failed to find a buyer during the spring and summer.
The combination will give buyers lots of supply to choose from, agents predict.
The traditional August lull settled over the city as summer holidays came to an end and families prepared for the start of the school year, says Anita Springate-Renaud, broker with Engel & Völkers.
“A lot of people are away – this is the last hurrah,” Ms. Springate-Renaud said of the Labour Day long weekend.
She advises potential sellers to hold off listing until the second week of September at the earliest because parents are too busy getting kids back in the swing of attending classes and activities to look at properties.
Ms. Springate-Renaud also expects some buyers to intensify their searches this fall as more companies require employees to work in the office five days a week.
She points to one set of clients who are looking for a house in Toronto so they can reduce the time and money they spend commuting to and from the Whitby area.
The clients do not work from home, she says, but they are concerned that congestion on Highway 401 will become even more intolerable when more employees return to offices full-time.
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The couple has the means to upsize to a larger house in the city, she says, but many buyers are still struggling to afford Toronto prices.
Some are hesitant to buy because they are betting that prices have further to fall, she adds.
“They don’t want to feel like they overpaid or that things will go down.”
Market watchers will also be keeping an eye on the Bank of Canada when policy-makers meet on Sept. 17 to decide whether to hold the benchmark interest rate at its current level of 2.75 per cent.
Patrick Perrier, director of forecasting at Bank of Nova Scotia, says an improvement in sales in July suggests buyers are looking past the tumult of trade tensions with the United States.
The Canadian housing market would likely already be in the midst of a sustained recovery in sales and prices without the unusual trade-related noise, Mr. Perrier says in a note to clients.
Still, Mr. Perrier notes that housing demand has faced significant headwinds as potential buyers remain uncertain about the possible impacts of global trade tensions on the economy and incomes.
“Any increase in trade tensions could further delay this recovery or even reverse it,” he cautions.
Meanwhile, some buyers view the current dip in prices as an opportunity to trade up. In a market downturn, starter homes typically hold their value more easily than higher-priced properties because of the larger buyer pool.
In East York, one couple saw that a property they had previously tried to buy had landed back on the market.
“This was a home they lost out on three years ago,” says real estate agent Rahim Jaffer of Sage Real Estate.
The detached house changed hands for $2.2-million near the peak of the market in 2022. This summer, the couple negotiated a deal for $2.06-million.
But while the couple were able to buy their move-up house at a discount, they had to quickly turn their attention to selling their semi-detached house in the same area.
“Sellers know that buyers aren’t necessarily paying attention to the market in the dog days of summer,” Mr. Jaffer says, “but they also know buyers are fickle.”
Mr. Jaffer contacted other agents with listings in the area, who told him that showings were fairly brisk, but house hunters were slow to act unless the property was move-in ready.
“We knew the buyers were out there.”
The sellers of 292 Milverton Blvd. accepted a bid for $1.3-million.Sage Real Estate Ltd.
The house at 292 Milverton Blvd. was already nicely renovated, but he recommended some touch-ups, including painting, changing dated light fixtures and staging throughout.
“Buyers are looking for perfect.”
His research showed that comparable semis have been selling around the $1.2-million range or slightly above, he says.
Mr. Jaffer listed the house with an eye-catching asking price of $1.089-million and a date for reviewing offers. He also drummed up some attention on social media.
On the first day, he fielded two pre-emptive offers from so-called bullies who refused to wait for the offer date.
Within about 12 hours, the sellers had accepted a bid for $1.3-million, or $213,000 above the asking price.
In Harbord Village, Mr. Jaffer sold another move-in ready semi on Major Street within a day of the launch.
“They were waiting for this,” he says of the buyers.
Toronto-area real estate sales pick up, with semis leading the way
Mr. Jaffer believes one reason that semis have been selling briskly is that buyers have been able to extend their budget above $1-million more easily after the federal government raised the cap on mortgage insurance last year.
Starting in December, 2024, properties in the bracket between $1-million and $1.5-million became eligible for mortgage insurance, and buyers are able to purchase with a down payment of less than 20 per cent.
Mr. Jaffer says the impact of the rule change has been limited, however, because many buyers still prefer the security of a hefty down payment.
Looking ahead, Mr. Jaffer expects to see listings swell again now that Labour Day is in the past.
Many sellers took down the “for sale” sign over the summer, he says, and that inventory may return in the fall, along with new supply.
“We saw a higher degree of listing terminations in July and August,” he says, adding that a lot of those sellers will come back, “hopefully with sharper pricing or better presentation.”