A multimonth slide in Toronto home prices slowed in October, as sellers stepped back in hope the market will improve if they wait.
The benchmark price for a home in Canadaâ€™s largest city fell 1.1% in October to C$1.1 million ($802,217) according to data released Thursday by the Toronto Regional Real Estate Board. Thatâ€™s the smallest decline in the seven straight months of price drops, bringing total losses to 17.7% on a non-seasonally adjusted basis, the data show.
Some homeowners appear to be delaying putting their homes on the market as a result. New listings in Toronto fell 11.6% in October from last year, reaching a level for that month not seen in 12 years, according to real estate board data. But the number of sales was still down much more, 49.1%, in the same period.
House prices began to fall in Toronto, and across the country, when the Bank of Canada started raising its benchmark interest rate. Itâ€™s gone from 0.25% in March to 3.75% today in one of the most aggressive campaigns to hike borrowing costs in the institutionâ€™s history. But with the threat of a recession rising, the central bank slowed the pace at its October meeting,
delivering a 50- basis-point hike rather than the 75 basis points it did at the meeting before.
That has prompted speculation that Canadaâ€™s central bank may be nearing the end of a rate cycle that has put such pressure on the economy, and the housing market.
â€œHome prices in the GTA have found support in recent months,â€ Jason Mercer, the Toronto real estate boardâ€™s chief market analyst, said in a press release, referring to the Greater Toronto Area. â€œThe Bank of Canadaâ€™s most recent messaging suggests that they are reaching the end of their tightening cycle.â€
The Bank of Canada also warned that the economy could be in danger of two straight quarters of economic contraction â€” a technical recession that could itself exact a further toll on the housing market.