At the beginning of every month, we work to compile statistics related to market activity within Toronto and the GTA.
MARKET SNAPSHOT - APRIL 2022
MARKET INSIGHT FOR THE WEEK ENDING MAY 20TH, 2022
The pandemic housing boom is winding down. Economists forecast a 10-20% price correction?
Economists are predicting that Canadian home prices will fall as much as 20 percent this year as higher interest rates begin to hit the country’s booming real estate market. Mortgage rates are expected to climb again as the Bank of Canada aggressively hikes interest rates to deal with runaway inflation. Economists expect higher borrowing costs will lead to a significant price drop in some of the hottest markets.
Toronto-Dominion Bank economist Rishi Sondhi forecasts a double-digit percentage decline in the national average home price over the March to December period this year. Bank of Montreal senior economist Robert Kavcic predicts a 10-per-cent to 20-per-cent drop in the home price index in certain regions. “When we speak of housing correction it’s not a question of if, but where, how much and for how long,” Mr. Kavcic said in a research note. “Suburban markets in Ontario look shakiest,” he said.
The housing slowdown has been triggered by a rapid increase in borrowing costs over the past few months. The Bank of Canada’s next interest-rate announcement is scheduled for June 1. The central bank is widely expected to hike interest rates by another 50 basis points.
Realtors have described a sudden change in buyer sentiment. Some homes are not fetching any offers and sitting on the market for upward of a month. That contrasts with the first two years of the pandemic when homes drew dozens of bidders and sold for hundreds of thousands of dollars over the listed price.
We are still seeing multiple offers happening in certain areas of the city, but we are not seeing the same frenzy that was present in the early months of the year. Showings have dropped off and buyers don’t seem to be in hurry to buy.
Don’t forget what CHMC said back in March 2020:
“Canada’s national housing agency is predicting home prices could plummet up to 18 percent and mortgage arrears could soar to 20 percent”
CMHC president and CEO Evan Siddall points to unforeseen circumstances as the reasons for their forecast error. CHMC lost its credibility after their failed housing crash prediction.
No one really knows what will happen to the real estate market. No one has a crystal ball to predict the future. We know we are state of change, and we will all learn to adjust to the changing market.
ABOUT BOSLEY REAL ESTATE LTD., BROKERAGE
Bosley Real Estate Ltd. is a full-service, 4th generation brokerage operating since 1928 with offices serving Toronto, Niagara, Waterloo Region, Southern Georgian Bay and Port Hope. With over 250 agents in residential and commercial real estate, the firm has built a reputation on trust, respect and integrity selling and leasing property throughout Ontario. Bosley Real Estate is also recognized internationally through an exclusive affiliation with Leading Real Estate Companies of the World®. This prestigious partnership connects the brokerage to a global network of 130,000 real estate professionals in 70 countries. Headquartered in Midtown Toronto, President and Broker of Record, Christan Bosley continues to innovate and maintains the high standard of excellence forged over a century.
HERE ARE THE TOP FIVE TRENDING STORIES OF THE WEEK:
“Real estate prices in Canada have already started to fall – and we could be seeing the first few shifting pebbles in a rockslide, according to one analysis.”
“According to a report released today from Statistics Canada (StatCan), Canada’s official inflation rate rose at a 6.8% annual pace in April, up from a gain of 6.7% in March.”
"“What’s driving global real estate higher? It’s the money, stupid. That’s a concise summary of research from the Bank of International Settlements (BIS).” "Learn More
‘Ontario stands to lose its edge’: OREA calls on political parties to build more homes, address affordability
“After two years of red-hot market activity, higher borrowing costs are causing a cool down in Canada’s feverish real estate markets during the traditionally busy spring months.”Learn More
“Sick of bidding wars? Can’t find your dream home? Priced out of the housing market? Whatever your motive, if you’ve ever thought that it might be cheaper and easier to buy a plot of land and build a brand-new house, you’re not alone.”Learn More