The average price of a home in the Greater Toronto Area (GTA) housing market climbed to an all-time high last month as competition among buyers continued to heat up.
The Toronto Regional Real Estate Board (TRREB) said Wednesday that 9,783 properties changed hands in the month, representing an eight per cent increase from September and a seven per cent drop from a year earlier.
The number of new listings fell 13 per cent month-over-month in October. Compared to a year earlier, inventory plunged 34 per cent.
“The only sustainable way to address housing affordability in the GTA is to deal with the persistent mismatch between demand and supply. Demand isn’t going away. And that’s why all three levels of government need to focus on supply,” said TRREB President Kevin Crigger in a release.
High demand and constrained supply helped push home prices even further into record territory as the average selling price of a property ticked up to $1,155,345 in October.
With financial markets widely expecting the Bank of Canada to begin hiking interest rates in the new year, many economists are assessing how that could impact real estate activity.
In a note to clients dated Nov. 2, BMO Economics Senior Economist Robert Kavcic questioned whether hot housing markets could be facing “one final bout of strength before things simmer down.”
He pointed out the historically popular five-year fixed mortgage rate has already begun rising; but perhaps more importantly, Kavcic said it’s likely the Bank of Canada will start raising rates sooner and more aggressively than many in the housing market might currently anticipate.