Seven Out of 10 GTA Homes Are Selling Below Asking

Homes that change hands for less than the list price are accounting for a growing share of overall sales in the Greater Toronto Area.

By Josh Sherman | 4 minute read

Relative to overall sales, it’s becoming more common for GTA buyers to purchase homes for less than the original list price.

It looks like Greater Toronto Area home sellers may be getting less stubborn about the offers they’re willing to accept from buyers.

Seventy per cent of the homes that buyers purchased across the Greater Toronto Area last month sold for less than listed while overall bidding competition further cooled in the region, suggests Wahi’s newly released August 2024 Market Pulse Report. A remaining 27% of homes were still selling above asking, while 3% sold for the seller’s asking price, though bidding activity remained somewhat stronger for single-family homes than condos.

On both a month-over-month and year-over-year basis, a greater share of homes were selling under asking in the GTA this August:

• In July, 68% of homes sold for less than the listed price, 29% were bid up, and 3% changed hands at the listed price. 
• In August 2023, 60% of homes were selling for below-asking, 37% netted sellers more than they asked for, and 4% sold as-listed. 

Declining interest rates had yet to spark more widespread bidding wars in the GTA last month as home sales continued to lag last year’s pace. In August, home sales across the region totalled 4,729, down about 11% from the same month in 2023.

While some would-be buyers may have been waiting for additional rate cuts last month, house hunters who took action last month had some opportunity to negotiate.

“Many homebuyers who decided to act this August before the fall market gets underway managed to obtain below list prices,” says Wahi CEO Benjy Katchen. “This was especially true for condo buyers,” he continues.

In August, 78% of condo units sold below asking, up from 76% during the previous month and 70% last year, according to Wahi’s analysis.

When only looking at single-family houses — including detached, semi-detached, row, and townhomes — the share of properties that sold below asking falls to 67%, albeit up two percentage points month-over-month. In August 2023, approximately half (55%) of single-family homes that sold had prices reduced from listing.

Katchen adds that when a home sells for less than the asking price, it doesn’t necessarily mean the homebuyers got a bargain. “The home could have been listed above what it was reasonably valued at,” he says, noting that Wahi’s Home Value Estimator can give buyers more insights into a home’s potential value range.

Despite more homes selling below asking last month, the median price of $935,000 was roughly unchanged from a year ago.

More GTA Neighbourhoods Enter Underbidding Territory in August 2024

The uptick in the share of homes selling for less than asking was also reflected at the neighbourhood level.

Out of the 272 neighbourhoods where at least five homes sold in August, 89% (242)  were in underbidding territory, up from 82% (227) in July. This represents the highest share of neighbourhoods in underbidding territory since January, when 98% of nieghbourhoods saw prices bid down. 

The Top 5 GTA Underbidding Neighbourhoods in August 2024

The top overbidding neighbourhood in August was Eastlake, in Oakville. That marks the 15th straight month that Eastlake has secured a place in the top five, making it the most consistently underbid neighbourhood in the GTA.

The Top 5 GTA Overbidding Neighbourhoods in August 2024 

There were no repeats from the previous month in the top five overbidding neighbourhoods in the GTA this August.

Note that when a neighbourhood is in overbidding territory, it doesn’t guarantee that every home is selling above-asking. Instead, it’s a general reflection of overall market behaviour, which can be influenced by seasonal factors, for example. It can also be affected by decisions by sellers, such as to list homes below market value to try and attract more bids.

How Wahi Ranks Overbidding and Underbidding Neighbourhoods

At the end of each month, Wahi compares the differences between median list and sold prices to determine whether neighbourhoods are in overbidding or underbidding territory, excluding those neighbourhoods with fewer than five transactions in a given month. A total of 272 neighbourhoods out of the GTA’s approximately 400 met this threshold in August, down from 276 in July. Data is sourced from Information Technology Systems Ontario (ITSO) and the Toronto Regional Real Estate Board (TRREB).

The top overbidding and underbidding neighbourhoods are ranked by the median overbid or underbid amount. The median overbid and underbid amounts are calculated by subtracting the list price from the sold price of each individual listing in a given neighbourhood. These are then ranked by the median of all subtractions and presented as the median overbid or underbid amount. For the latest data on overbidding and underbidding at any point in the month, Wahi’s Market Pulse tool provides readings based on the past 30 days of transactions.