T
he Toronto-area real estate market is experiencing a peculiar state where potential buyers are hesitant to make a move due to high borrowing costs, but also fear missing out on deals if they wait too long. This has led to a slowdown in sales after the initial surge in October. Andre Kutyan, a broker with Harvey Kalles Real Estate Ltd., notes that while some properties are selling quickly, others have been languishing with multiple price cuts.

    Kutyan recently listed a three-bedroom house at 351 Deloraine Ave. for $2.499-million, hoping to capitalize on the pent-up demand in the area. However, he acknowledges that market fundamentals have changed since the pre-pandemic era and prices are unlikely to rise significantly anytime soon. Interest rates need to be in neutral territory for six to 12 months before buyers will feel confident enough to push prices higher.

    Mortgage broker Matthew O'Neill says deals have been slower to come in as November draws to a close, with purchasers who find a property now likely not closing until February. This is not an ideal time for most people to move house. Kutyan believes that most homeowners who are thinking of selling will wait until the spring.

    The Bank of Canada may trim interest rates again in December, but waiting until after that date would bring new listings too close to the holidays, making many hesitant to list now. Economists are cautioning that the central bank may slow its rate-cutting due to recent economic data and government stimulus payments.

    Despite this, some experts believe that lower interest rates have already begun to unlock housing demand, and TD economists expect mortgage rates to decline further in 2025. The loosening of mortgage rules set to come into effect in December should also support sales and prices in early 2025.