GTA New Home Sales Remain Sluggish in September Despite Rate Cuts: Is Now the Right Time to Buy?

The Greater Toronto Area’s (GTA) new home market saw continued slow sales in September, even as multiple Bank of Canada interest rate cuts aimed to revive buyer interest. According to the Building Industry and Land Development Association (BILD), new home sales dropped significantly last month, reaching just 591 units—a 69% decline compared to the same period in 2023.

This recent report underscores a notable downturn in both single-family and condominium segments. Single-family homes, including detached, semi-detached, linked, and townhouse properties, saw 344 sales—a 41% decrease from last September. Condominiums experienced an even steeper fall, with only 247 units sold, marking an 81% year-over-year decline.

“Despite the Bank of Canada’s three consecutive interest rate cuts, GTA new home sales remained slow in September,” said Edward Jegg, research manager with Altus Group, BILD’s new home market insights provider. Following an extended period with rates held at 5%, the central bank began reducing its rate in June, now reaching 3.75%.

The report highlights a unique opportunity for buyers, as the GTA market currently holds elevated inventory levels and lower prices—key factors that could signal a favorable time to purchase. Total inventory reached nearly 22,000 units, with close to 17,500 condo units and about 4,500 single-family homes. This supply level represents a combined inventory of 13.8 months based on recent average monthly sales, consistent with inventory trends around 20,000 units since autumn 2023.

“Although the current inventory levels and falling prices create a buyer-friendly environment, sustained low sales could lead to an eventual supply crunch in the GTA,” Jegg noted. “If sales stay this low, the reduced pace of housing starts will set the stage for future shortages and potential price increases.”

Alongside the rise in available homes, prices have seen modest reductions. The benchmark price for condos dropped to $1.025 million, a 1% decrease from last year, while single-family homes saw a slight decline to $1.565 million, down 0.1% over the same period.

For prospective buyers, this period of market stagnation presents a window of opportunity. Elevated inventories and reduced prices offer favorable conditions, though the market’s future trajectory may point toward supply challenges and higher prices. As interest rates hold steady at lower levels, buyers may find this an opportune time to make their move in the GTA housing market.