Home Sales and Listings in Greater Toronto Drop in July 2022

July 2022 saw a 47% decrease in home sales compared to July 2021 in the Greater Toronto Area, with there being a total of 4,912 sales throughout the month, according to the Toronto Regional Real Estate Board (TRREB) MLS® System. Sales were also down from June 2022. Meanwhile, new property listings saw a year-on-year decline compared to July 2022, dropping 4%.

Many experts expect listings to keep mirroring home sale trends for the rest of 2022 and at the start of 2023.

Overall, the property market is looking a lot more stable than this time last year. There are more homes available to buyers to choose between, and price growth has slowed. However, prices are still rising — the MLS® Home Price Index (HPI) Composite Benchmark increased by 12.9% compared to July 2021, while the average selling price for the region rose to $1,074,754. This represents a 1.2% increase.

More affordable home types enjoyed more price growth, including condominium apartments. This may be due to buyers looking for less expensive alternatives now that interest rates and mortgage costs have risen. 

Toronto’s population is still increasing, and this is unlikely to change any time soon with such a tight labor market. As a result, some price growth is likely to continue over the next few years, even as the market balances out. The government needs to do what it can to increase the housing supply to compensate for the high demand in the area and ensure affordability. 

The Toronto Regional Real Estate Board has already made some suggestions for policymakers. It recognizes how important it is to ensure properties are available and ready for when the market tightens again — this is bound to happen sooner or later with the savings rate high right now.

The government could also help to reduce uncertainty in the markets by boosting transparency about how the mortgage lending process works and what to expect from housing development in the future.

Another area for attention is the OSFI stress test, which the TRREB believes is in need of a review. Those who want to renew a mortgage with another lender shouldn’t have to be put through an additional stress test. 

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