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Market Performance and Sales Data:
In March 2024, the Greater Toronto Area (GTA) experienced a moderate increase in the average home price compared to the previous year despite a better-supplied market. This indicates strong competition among buyers.
The GTA saw a 4.5% decline in home sales in March 2024 compared to March 2023, with 6,560 sales reported.
New listings increased by 15% over the same period, sales dropped by 1.1%, and new listings decreased by 3% on a seasonally adjusted monthly basis compared to February.
The first quarter of 2024 concluded with an 11.2% rise in sales year-over-year and an 18.3% increase in new listings, suggesting a gradual improvement in market conditions.
Market Insights and Future Outlook:
A gradual market improvement was noted over the past quarter, attributed to buyers adjusting to higher interest rates and homeowners anticipating better conditions in spring, leading to a significant rise in new listings.
The anticipation of lower borrowing costs could further boost sales, absorb new listings, and tighten market conditions, pushing selling prices higher.
The Home Price Index (HPI) Composite benchmark increased by 0.3% year-over-year, with the average selling price rising by 1.3% to $1,121,615. On a month-over-month basis, the HPI and average selling price saw increases of 0.2% and 0.7%, respectively.
Price growth is expected to accelerate during the spring and further in the second half of the year as sales growth catches up with listing to continuously grow, leading to sellers' market conditions in many neighbourhoods.
Housing Supply and Government Policy:
The increasing demand for ownership and rental housing emphasizes the need for a continuous focus on innovative solutions to enhance the housing supply and affordability.
Governments are encouraged to pursue strategies that remove obstacles to non-traditional housing arrangements, like co-ownership models, which could benefit various buyers, including first-time buyers and seniors.
Encouraging gentle density, such as the development of multiplexes, is seen as crucial for addressing the housing supply challenges in high-demand areas like the Greater Golden Horseshoe.