Nearly 80% of homes sold for below list price in the Greater Toronto Area last month

Most homes sold for below the asking price in the Greater Toronto Area last month.

Those looking to buy a home could find lower prices this August—the average selling price, at $1,022,143, was down by 5.2 per cent compared to August 2024.

And many home buyers are getting properties for below the list price, real estate platform Wahi said in a new report.

Overall, 79 per cent of homes across the GTA sold below list price in August, a clear sign that buyers remain in the driver’s seat, Wahi noted.

“The summer months are typically softer than the spring for home sales, but the extent of underbidding activity we’re witnessing in the GTA suggests there’s more at play than homebuyers taking vacations,” says Wahi economist Ryan McLaughlin.

Looking at neighbourhoods, 98 per cent of the 278 GTA neighbourhoods with at least five home sales in August landed in underbidding territory, with the rest selling at or above asking, the report found.

This represents an increase from July, when 95 per cent of neighbourhoods were underbid, as well as compared to the same time a year ago, when the share of underbid neighbourhoods reached 89 per cent.

August represents just the third time since Wahi began tracking GTA home-buying competition in July of 2022 that underbidding has been so widespread at the neighbourhood level. In both December 2023 and January 2024, 98 per cent of neighbourhoods were also in underbidding territory.

Some neighbourhoods are seeing more underbidding than others.

Among the five neighbourhoods with the strongest underbidding trends in August, two were carryovers from the previous month: York Mills and rural Vaughan. These neighbourhoods tended to be on the pricier side, Wahi said. Three out of four had a median sale price at or around $3 million, whereas the GTA-wide median home price for the month of August was $900,000.

Of the four neighbourhoods in which homebuyers bid prices higher in August, Brock Ridge, in Pickering, was the lone repeat from July. In two of these neighbourhoods, the median overbid amount was less than $2,000, Wahi noted.

A downturn in the condo market isn’t the only reason for the increase in underbidding.

Looking only at single-family home sales, 94 per cent of the 223 neighbourhoods with at least five transactions of this property type were underbid last month, Wahi noted. That nearly matches the extent of underbidding in the condo market. Some 97 per cent of the 102 neighbourhoods with at least five condo sales were in underbidding territory.

McLaughlin noted that in addition to seasonal factors limiting home-buying activity — and, consequently, competition — listings sometimes appear bid down because sellers may not have set realistic prices to begin with. Conversely, a neighbourhood could be overbid as a result of sellers listing homes below market value in hopes of attracting multiple offers.

Read the full report from Wahi here.

Lead photo: RDNE Stock project