TORONTO — Home prices in the Greater Toronto Area remained under pressure in August as new listings outpaced sales, but the city's real estate board says a potential interest rate cut later this month could help catalyze a new wave of activity.
The Toronto Regional Real Estate Board said the average sale price was down 5.2 per cent in August from last year to $1.02 million, with the composite benchmark price falling by the same amount.
"A household earning the average income in the GTA is still finding it challenging to afford the monthly mortgage payment associated with the purchase of an average priced home," said TRREB chief information officer Jason Mercer in a press release.
"This is even with lower borrowing costs and selling prices over the past year."
The board said home sales were up 2.3 per cent in August from a year earlier, while down 1.8 per cent on a seasonally adjusted basis from July.
A total of 5,211 properties changed hands last month.
“Compared to last year, we have seen a modest increase in home sales over the summer," said TRREB president Elechia Barry-Sproule in a press release.
"With the economy slowing and inflation under control, additional interest rate cuts by the Bank of Canada could help offset the impact of tariffs. Greater affordability would not only support more home sales but also generate significant economic spinoff benefits."
The Bank of Canada left its policy rate unchanged for the third time in a row in its latest decision on July 30, but said future cuts may be warranted as U.S. tariffs persist.
The central bank’s policy rate remains at 2.75 per cent ahead of its next decision on Sept. 17.
While potential buyers might be holding out hope for a cut, it may not be the most important economic factor when it comes to affordability, said Tom Storey, a sales representative at Royal LePage Signature Realty.
"I think at the end of the day, it might impact the buyers' mindsets more than it impacts their wallets," he said.
"That's going to be the most talked about thing, what the Bank of Canada does or doesn't do, but I would say what happens with inventory levels and prices is going to be more indicative on what happens for transaction volume."
New listings were up 9.4 per cent from a year earlier to 14,038 last month. Active listings were up 22.4 per cent from last year with 27,495 homes on the market.
Storey said more buyers are inclined to enter the market compared with March and April, when activity plummeted as economic uncertainty associated with tariffs dominated headlines.
While the summer is usually a slow period for the real estate sector, Storey said this year has been "the opposite from what we normally see" as consumer confidence has begun to rebound.
But it's still taken some time for buyers and sellers to reach a point where they agree on price.
"When we have significant changes in the market, whether that's inventory level or prices or interest rates, there's a period of time that buyers have decided this is their price and sellers are still holding at the old prices," he said.
"What I can tell you from my own business is that more sellers are saying, 'OK, fine, if that's the price, I'll take it now.' But they wouldn't have had that thought process 30, 60 days ago."
In the City of Toronto, there were 1,779 sales last month, a 3.5 per cent increase from August 2024. Throughout the rest of the GTA, home sales were up 1.7 per cent to 3,432.
Overall, all property types except condos saw more sales in August compared with a year ago throughout the region.
The largest increase was in the detached segment, which was up 5.9 per cent, followed by semi-detached houses with a 2.6 per cent increase and townhouses with a 2.4 per cent increase.
The number of condos that changed hands was 4.9 per cent lower than in August 2024.
This report by The Canadian Press was first published Sept. 4, 2025.
Sammy Hudes, The Canadian Press
