New Home Sales in Toronto Hit Record-Low in July: Building Association

A home is shown for sale in Toronto’s West End on July 15, 2023. The Canadian Press/Graeme Roy

Sales of newly built homes in the Greater Toronto Area (GTA) hit a new low in July, breaking the previous record set just two months earlier, a building association says.

In July, just over 650 new homes were sold, marking a 48 percent drop from July 2023 and a 70 percent decrease from the 10-year average, the Building Industry and Land Development Association (BILD) said in a release on Aug. 28.

“GTA new homes sales in July 2024 sank to another record monthly low as buyers remained unwilling to leave the sidelines,” Edward Jegg, research manager at Altus Group, BILD’s source for new home market data, said in the release.

“Further expected decreases in interest rates in the coming months, along with elevated inventories, means there will be plenty of opportunities once consumer confidence improves.”

Among the new homes sold in July, 287 were condo apartments, representing a 67 percent decrease from July 2023 and an 81 percent drop below the 10-year average. Additionally, there were 367 single-family home sales in July, down one percent from July 2023 but 42 percent below the 10-year average.

The new record-low follows BILD’s June report saying new home sales hit their lowest point in May, a level the association said had not been seen since the start of the pandemic in May 2020.

Total new home inventory has accrued to nearly 22,000 units, including roughly 17,500 condominium units and 4,200 single-family homes. This represents around a 15-month supply, according to BILD, which notes that the high level of available homes has been observed since last fall.

“Months of inventory are increasing not because the number of new units coming to market is dramatically increasing, but rather because sales are continually decreasing,” said the release.

“This is an unhealthy situation, because as interest rates decrease, sales will return but it will take longer for new building to recover, setting up a future supply/demand imbalance.”

The Toronto Regional Real Estate Board reported that total home sales in June declined by 16.4 percent compared to the same month in the previous year. In June 2024, there were about 6,200 home sales, down from roughly 7,400 sales in June 2023. This decline occurred amid the Bank of Canada’s interest rate cuts, following several months of maintaining its benchmark rate at 5 percent to address inflation.