The house at 3547 Trelawny Circle, in Mississauga, Ont., was listed with an asking price in the $2.2-million range and sold for $1.895-million.Royal LePage Real Estate Services Ltd.
Real estate buyers who look beyond Toronto to some of the Golden Horseshoe’s small towns and suburbs have been eyeing the market with extreme caution this fall.
Sales have been lacklustre in recent months, while prices have oscillated. In some pockets, the average price has risen as higher-end homes trade hands.
Matthew Regan, broker with Royal LePage Real Estate Services, has seen positive signs in communities west of Toronto in recent weeks.
Some buyers moved off the sidelines in areas such as Mississauga, Oakville, Hamilton, Niagara and Kitchener-Waterloo after the Bank of Canada held its key interest rate steady in October.
Mr. Regan figures the central bank’s decision to stand pat bolstered the confidence of buyers with cash or with significant equity in their current home.
He points to a house in Mississauga, which drew rival bids after 60 days on the market. The house at 3547 Trelawny Circle was listed with an asking price in the $2.2-million range and sold for $1.895-million.
The house drew rival bids after 60 days on the market.Royal LePage Real Estate Services Ltd.
“Out of nowhere it gets two offers – cash buyers competed on it,” Mr. Regan says.
Farther south, a four-bedroom house with an asking price just below $4-million sold within a few days in November with two offers, he adds. The 1960s-era house has views of Lake Ontario and sits close to the trails of the Rattray Marsh Conservation Area.
Mr. Regan says sellers still need to avoid setting asking prices too high, but some buyers are taking advantage of the market slowdown to trade up to a larger home.
In Mississauga, sales rose 8.3 per cent in October from September. The market remained subdued, according to the Mississauga Real Estate Board, with sales coming in 41.9 per cent below the five-year average for the month of October.
New listings dipped in October but active listings edged up to bring months of inventory, which measures the time it would take to sell all available listings at the current pace of sales, to 4.1.
The average price in Mississauga came in at $1.106-million to mark an 8.3-per-cent increase from September.
Mr. Regan says inventory began to swell in September after homeowners listed their houses for sale in the late spring and summer – just as buyers pulled the emergency brake.
Meanwhile, a cohort of homeowners who delayed listing during that period planted a “for sale” sign in September.
“You’ve got the people who wanted to sell but couldn’t, plus the people who were holding off. They all entered the market in the fall,” he says.
Home sales rose 8.3 per cent in Mississauga in October from September.Royal LePage Real Estate Services Ltd.
Mr. Regan says the current market feels more balanced, which makes buying much easier for people who don’t want to compete.
He is already receiving calls from homeowners who plan to list as soon as the spring market kicks off.
“We have a slew of listings coming in February. Look for them to list in the spring when they come back from Florida and Arizona.”
Mr. Regan says the vacation home market is seeing an increase in sales by owners who purchased a cottage or country home during the pandemic. Many used a “home equity line of credit” tied to their principal residence when interest rates were ultralow, he says.
Now that interest rates have risen, many of those owners in many Ontario places such as Collingwood, Muskoka and Peterborough, are stretched.
“I don’t know if panic selling is the word but certainly pressure selling,” he says of people trying to lighten their debt burdens.
Nationally, sales fell 5.6 per cent in October from September, according to the Canadian Real Estate Association. Across Canada, the average home price was $656,625 in October.
The number of newly listed homes fell 2.3 per cent in the same period, marking the first decline since March, according to CREA.
Farah Omran, senior economist at Bank of Nova Scotia, notes the sales-to-new-listings ratio, an indicator of how tight the market is, dipped to a 10-year low of 49.5 per cent.
That’s far below the ratio’s January, 2022 level of more than 80 per cent, she adds.
Ms. Omran notes that prices fluctuate – especially in Ontario – but remain well above pre-pandemic levels.
Shawn Lackie, real estate agent with Coldwell Banker R.M.R. Real Estate, says Durham Region, east of Toronto, is tipping towards a buyer’s market.
Sales dropped 10 per cent in October compared with September in Durham, which includes such communities as Oshawa, Whitby, Ajax, Bowmanville and Uxbridge.
New listings in October remained flat with September but active listings in the area rose nine per cent in October compared with the previous month.
Months of inventory climbed to three from 2.5 in September, Mr. Lackie says.
The average price in Durham rose 2.6 per cent in October to $931,548.
Mr. Lackie expects the market to remain slow in the coming months.
Home sales in the areas outside Toronto have been lacklustre in recent months, while prices have oscillated.Royal LePage Real Estate Services Ltd.
“The madness is over,” says Mr. Lackie. “We’re probably two years away from feeling the full fallout of what happened during the pandemic.”
During 2020 and 2021, many urban dwellers fled their condos and cramped houses in Toronto’s central 416 area code in order to acquire larger houses and backyards in the 905 and beyond. Durham and the surrounding areas saw an influx of new residents, along with rapidly escalating real estate prices.
“They all ran out and bought in Cobourg, Port Perry and Uxbridge when they could work from home,” says Mr. Lackie. “Now they’ve found it’s not what they expected it to be – or the boss wants them back in the office.”
Mr. Lackie says many people can’t sell the house today for what they paid for it two or three years ago. Leasing out the house in the country and renting an apartment in the city is no longer an option, in many cases, because rents have spiked in Toronto.
Mr. Lackie says sellers are in a bind now if they set their asking price too high.
Mr. Lackie says he understands the dilemma for sellers who are attached to their home and affix a certain value to it. But he cautions that they make a mistake when they decide to list at an inflated asking price just to test the market.
“If you overlist and you don’t get showings, literally after two weeks you’re chasing the market down. You’re starting out behind and you stay behind.”
Some homeowners who haven’t sold in the fall prefer to take their property off the market during December and January and relaunch in the spring. Mr. Lackie is advising sellers to leave the “for sale” sign up because prospective buyers tend to keep their eye on the market.
Still, he adds that those buyers are very wary at the moment – especially with mortgage rates above six per cent. Many are waiting to see if prices will soften.
“They’re holding onto their purse strings really tightly and rightly so. They’re playing the long game.”