As 2024 comes to an end (sorry, not sorry), there’s a LOT to look forward to in Toronto real estate. Here’s a recap of the most important real estate news this month:

Another Interest Rate Decrease

The Bank of Canada delivered it’s fifth straight interest rate cut on December 11, 2024, and the second 0.5% decrease in as many months. After being stuck at 5% for nearly a year, the current overnight rate of 3.25% will be welcomed by variable-rate mortgage holders and those looking to buy a property in early 2025.

In real numbers: A 1.75% decrease in interest rate on a million dollar mortgage is equal to $916 in payment savings per month.

The Market Continues to Recover

The GTA real estate market continued to show signs of recovery in November, driven by lower borrowing costs and increased buyer activity. Of note:

Sales Volume UP (a lot): The number of home sales surged year-over-year in November, with a 40.1% increase compared to last year. Lower interest rates and plenty of inventory of homes for sale fueled the buyers. This upswing is primarily attributed to lower borrowing costs, prompting buyers who were previously sidelined by high interest rates to re-enter the market.
New Listings UP (but only by a little): While the number of new listings also increased compared to last year (up 6.6%), the growth rate was significantly lower than that of sales. This difference in growth rates led to a tightening of market conditions.
Average Price UP: The average selling price in the GTA reached $1,106,050, reflecting a 2.6% increase from November 2023. Month-over-month, the average selling price dipped by $30,000. This minor adjustment could be attributed to seasonal fluctuations and the mix of properties sold.
Different Segments Experienced Varying Trends: The stats show how average home prices changed in the City of Toronto in November vs last year:
- The average price of a detached home was $1,695,939 (up 5.9%)
- Semi-detached: $1,248,930 (up 2.8%)
- Townhouse: $904,335 (-6.1%)
- Condo: $713,364 (-0.3%)
It’s a Condo Buyer’s Market: Toronto’s condo market continued to experience a decline in average selling price, as the market continues to absorb an excess of inventory. In November 2024, there were more than TWICE the number of active listings vs. last year. We are firmly in a buyer’s market now, where ample inventory provides buyers with significant negotiating leverage.
Days on Market: A More Balanced Landscape: Analyzing how long a property takes to sell – known as Days on Market (DOM) in real estate jargon – provides important insight into the health of the real estate market. In November 2024, the average home was listed for a total of 39 days – up from 33 days in November 2023, but most importantly, down from the 43 days it took last month.

Related: Read the November 2024 Stats

Longer Mortgage Amortization for First Time Buyers

As of December 15, 2024, insured first-time home buyers (in other words, buyers with down payments of less than 20%) will be able to amortize their mortgage payments over 30 years (instead of 25 years). By spreading repayment back over a longer period of time, borrowers benefit from lower monthly payments – and may be able to borrow more than they could previously.

For example: A first-time buyer buys a property for $800,000 with a 10% downpayment. At a 4-year fixed interest rate of 4.09%, the mortgage payment decreases by $362 monthly, when amortized over 30 years instead of 25, from $3,822 to $3,460.

If you aren’t a first-time buyer, you can still amortize your payments over 30 years IF you have a downpayment that’s 20% or more of the purchase price.

Pro Tip: While lower monthly payments are great in the short-term, it’s important to fully understand how your total costs of borrowing change when you amortize your mortgage over 30 years instead of 25.

Help for Buyers in the $1-1.5 Million Range

In Canada, homebuyers with down payments of less than 20% need to get mortgage insurance (for example, through CMHC). In the past, the only properties that were eligible for the mandatory insurance were those priced under $1 million – which seriously restricted the properties that could be purchased in Toronto. If you didn’t have a $200,000 downpayment, you had to buy a home priced under $1 million.

As of December 15th, 2024, would-be homeowners will be able to qualify for mortgage insurance for properties priced up to $1.5 million. While this will give buyers with less than a 20% dowpayment more homes to choose from, it doesn’t come free.

Pro Tip: Talk to your REALTOR and lender to understand the impact of buying a more expensive home with a smaller downpayment.

Help for Buyers of Newly-Built Homes

Effective December 15th, all buyers of newly-built homes will qualify to stretch their mortgage payments over 30 years instead of 25. While this will help buyers looking to buy pre-construction condos and houses, the real goal here is to help the struggling pre-construction industry and encourage builders to keep building much-needed homes.

Final Thoughts

We continue to see signs of recovery in Toronto’s real estate market, fueled by lower borrowing costs and renewed buyer confidence. We expect the easing of mortgage restrictions this month will further help the recovery and could lead to increased competition and price pressure in the coming months. Condos will continue to offer opportunities to those seeking affordability and negotiating power.

What we’re watching in 2025:

Buyer and seller confidence
The Bank of Canada’s rate announcements on January 29th and March 12, 2025
The looming mortgage renewal avalanche: 1.2 million fixed-rate mortgages come up for renewal in 2025 at much higher interest rates than in 2020.
The Trump effect on the Canadian economy – tariffs, inflation, the Canadian dollar, investor distraction…

Thinking of getting in or out of Toronto’s real estate market in 2025? Make sure to read: How to Prepare Now for a Winter/Spring 2025 Sale.

Need to Know: Toronto Real Estate News, December 2024