GTA Housing Market Sees First Rise in Overbidding Since March

As the leaves begin to fall, homebuying competition is on the rise with 13% of Greater Toronto Area neighbourhoods in overbidding territory this September.

By Josh Sherman | 3 minute read

The Greater Toronto Area’s housing market is showing possible green shoots, though most homes are still selling for below-asking.

For the first time since March, the share of Greater Toronto Area neighbourhoods in overbidding territory increased as competition for single-family homes started to simmer.

In September, 13% of the 284 neighbourhoods that had at least five home sales during the month were in overbidding territory, up from 8% the previous month, according to new analysis from digital real estate platform Wahi.

Another 1% of neighbourhoods were selling at-asking in September. However, the vast majority (86%) remained underbid.

“With the start of the historically busier fall real estate market, stronger competition is expected,” says Wahi CEO Benjy Katchen. “However, we’re still seeing transaction levels and bidding activity well below last year’s level for this time of year,” he adds.

Last September, 24% of GTA neighbourhoods were in overbidding territory, with an additional 3% selling at-asking.

Demand for Houses Drives Bidding Competition

The condo and single-family home segments appear to be moving in different directions.

When only looking at condos, 5% of neighbourhoods with at least five condo sales were overbid, compared to 8% in August and 10% in September 2023.

For single-family homes, nearly one-in-five neighbourhoods (18%) saw prices bid up, an increase from 13% the previous month but nowhere near last year’s level (35%).

Most Homes Are Still Selling Below Asking

Wahi also tracks the percentage of homes that sell for less than they are listed for. Overall, 69% of homes of all types that sold in September were purchased for below-asking, down from 70% the previous month. 

That’s significantly higher than a year ago, when below-asking sales accounted for 61% of all transactions.

However, here, too, we see a divergence by housing type. A lower share of single-family homes (64%) were purchased for less than asking last month than condos (77%). The share of below-asking condo sales was roughly unchanged from August, but for single-family homes there was a decline of three percentage points.

The Top 5 GTA Underbidding Neighbourhoods in September 2024

After 15 straight months in the top five, the Oakville neighbourhood of Eastlake was not among the GTA’s top five underbidding neighbourhoods in September. Three of the top five underbidding neighbourhoods were located within the City of Toronto, up from two in August. The top underbidding neighbourhood, Toronto’s Forest Hill community, was last in the top five in June, when it placed fourth for underbidding.

The Top 5 GTA Overbidding Neighbourhoods in September 2024 

With the exception of Port Credit, in Mississauga, luxury markets with price points between $2 million and $4 million dominated in terms of underbidding last month. Meanwhile, Toronto neighbourhoods accounted for four of the top five overbidding neighbourhoods, led by St. Clair West, in Old Toronto. In August, two neighbourhoods (The Danforth and Parkwoods) were some of the GTA’s most overbid. Note that when a neighbourhood is in overbidding territory, it doesn’t necessarily mean 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, or 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 284 neighbourhoods out of the GTA’s approximately 400 met this threshold in September, down from 272 in August. 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.