(Bloomberg) -- Toronto home prices dipped again in September and have now fallen 17% from their spring peak, as evidence grows that buyers and sellers are growing wary of doing deals.

The benchmark price for a home in Canada’s largest city fell a further 1.2% from August, adding to the string of declines that began in April, according to data released Wednesday from the Toronto Regional Real Estate Board. 

That brought the benchmark price to C$1.1 million (about $813,000), its lowest since last October, the data show.

Only 5,038 homes were sold during the month, down 44% from a year earlier. 

The Bank of Canada’s abrupt reversal of record-low interest rates has hit markets like Toronto, which experienced rapid price inflation through the pandemic, the hardest. And with inflation still at 7%, the central bank has signaled it’s not finished raising rates, causing most forecasters to predict the real estate correction will continue.

The central bank has raised its benchmark rate from 0.25% to 3.25% since March. Markets expect it may rise to 4% in the months ahead, according to Bloomberg calculations. The bank’s next rate decision is Oct. 26. 

Limited Supply

The data show that higher borrowing costs have forced buyers from the market, but sellers appear to be pulling back, too. New listings fell to their lowest level for the month of September in 20 years, the real estate board said. 

That lack of new supply may have helped cushion prices: the 1.2% monthly price drop was the smallest decline since the correction began.

“October generally represents the peak of the fall market, so it will be important to see where price trends head over the next month,” Jason Mercer, the real estate board’s chief market analyst, said in a statement. 

Meanwhile, in Vancouver, long Canada’s most expensive real estate market, benchmark prices fell 2.1% in September, bringing the cumulative decline in the last six months to 8.5%. But sellers were still coming to market, with new listings up 27% from the month before, according to data from the city’s real estate board. 

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