Since interest rates began rising in the first quarter of 2022, home sales and prices have plummeted in most of the Greater Toronto Area.
The Bank of Canada (BoC) began raising its benchmark interest rate, which commercial banks use to set mortgage rates, in March 2022. Since then, the BoC has raised its overnight lending rate from 0.25 per cent to five per cent.
The average price for all housing types combined in the GTA peaked at $1,334,544 in February 2022. Since then, this combined average has fallen 15.6 per cent to $1,125,928 in October.
All of the cities and towns tracked by the Toronto Regional Real Estate Board (TRREB) have experienced price declines since the peak. However, the declines have been more pronounced in some markets than others.
The city of Toronto has seen the smallest declines over this period, but not uniformly across the city.
TRREB divides Toronto into three areas – East, West and Centre. Toronto Centre, which includes the downtown core, has seen a decline of only 0.43 per cent, while Toronto East and West have seen their average house prices fall by 7.2 per cent and 16.3 per cent respectively.
The areas surrounding Toronto are also a mixed bag, with average combined house price declines ranging from 9.7 per cent to a high of 41.4 per cent since the market peak in February 2022.
Outside of Toronto, Mississauga has seen the smallest price decline at 9.7 per cent, while King Township in York Region has seen the largest decline at 41.4 per cent.
Three markets saw average prices fall between 30 and 40 per cent, including Brock (38.5 per cent) and Scugog (35.9 per cent) in Durham Region, and Adjala-Tosorontio (34.5 per cent) in South Simcoe County.
Of the remaining 25 Toronto-area cities and towns tracked by TRREB, six have seen their average home prices fall between 10 and 20 per cent.
These include Aurora (15.1 per cent), Markham (14.5 per cent) and Richmond Hill (12.3 per cent) in York Region, Halton Hills (17.8 per cent) in Halton Region, Clarington (16.4 per cent) and Uxbridge (12.6 per cent) in Durham Region, and Innisfil (17.5 per cent) in Southern Simcoe County.
The remaining 19 TRREB areas all experienced declines between 20 and 30 per cent.
Real estate sales in the GTA have also fallen sharply over the past year, with last month’s sales total the lowest for the month of October since 1996.
