**The Toronto Regional Real Estate Board released December data that showed home sales declined from a month earlier.**

Home sales in Toronto fell 43% in December from a month earlier, and active listings increased, leading to the highest inventory levels in years in Canada’s largest real estate market.

There were 3,359 transactions last month, compared with 5,867 in November, the Toronto Regional Real Estate Board said Tuesday. Compared with a year earlier, home sales fell slightly, around 1.7%. Meanwhile, active listings were 15,393 in December, an increase of about 6% from November and almost 50% higher than the 10,368 from the same month a year earlier, TRREB reported.

Daren King, an economist at National Bank Financial Markets, said low sales and the highest level of active listings since 2009 resulted in inventory increasing for the eighth time in nine months and the softest market conditions since the financial crisis.

King said he doesn’t see the decline in sales as the beginning of a trend, since factors such as the recent interest rate cuts from the Bank of Canada and the federal government’s lengthening of amortization periods to 30 years for first time buyers could be supportive. However, he cautioned that the recent rise in long term bond yields—which could be passed through to mortgage rates—as well as “persistent affordability challenges in Toronto and a weak labour market could limit the extent of the recovery on the housing market in the region.”

Even with the looser market conditions, home prices advanced for the second straight month, King said.

Unemployment in Toronto was around 8% in November. The next jobs report from Statistics Canada is due Friday. The Bank of Canada, which has cut interest rates 175 basis points since June to 3.25%, next meets on Jan. 29.

For the whole year, sales in Toronto amounted to 67,610, an increase of 2.6% from 2023, which was the slowest year for sales in at least a decade, according to the TRREB report.