Canada is seeing “early signs” of a housing market upturn and Toronto could see prices bottom out this spring, a recent report from the Royal Bank of Canada says.
In the report, which was released last week, RBC said January was the second consecutive month where residential transactions increased in major markets across the country.
“… it suggests the downturn that started in the spring of 2022 may have run its course,” the report, authored by economist Robert Hogue, read.
“Interest rate drops for fixed-rate mortgages since November have cracked the door open for buyers. And growing expectations the Bank of Canada’s next move will be a rate cut are tentatively bolstering (low) confidence.”
Hogue went on to note that a more “vigorous” and “sustained” recovery isn’t expected to happen before interest rates fall further, likely in the second half of 2024.
Canada has also not yet seen any early indicators of a “spike” in sellers due to higher borrowing costs, the report states.
“If anything, new listings were on the weak side, working to tighten demand-supply conditions. There’s a risk mortgage renewal payment shocks could set off a wave of distressed sales,” the report read.
While prices have fallen in the majority of Canada’s major markets, Calgary has bucked that trend with prices maintaining an “upward trajectory.”
RBC is predicting prices to fall one percent nationwide in 2024, with a 2.2 per cent uptick in Alberta and a two per cent drop in Ontario.
According to Hogue, the housing market may be turning a corner in the Toronto area.
“It could be that the recent drop in fixed mortgage rates was just what some buyers were waiting for to seal a deal. Or that unusually mild weather put them in a spring-like upbeat mood.”
The report was quick to point out that “stretched affordability conditions” are likely to keep buyers out of the market until interest rates, property values, or both, fall “more meaningfully.”
“For now, prices continue to drift lower,” the report continued.
The average selling price of a Toronto home across all property types peaked at $1,334,062 in February 2022 before dropping to a low of $1,037,542 later that year, according to data from the Toronto Regional Real Estate Board (TRREB).
Since then prices have largely held steady with the exception of a burst of activity last spring.
Toronto has seen six consecutive monthly price declines since July, for a total drop of $84,000, or 7.2 per cent, the report noted.
“That trend may not persist much longer if the recent tightening in demand-supply conditions is sustained,” the report read. “We expect prices will reach their bottom this spring and gradually recover over the second half of 2024.”
FAQs
“That trend may not persist much longer if the recent tightening in demand-supply conditions is sustained,” the report read. “We expect prices will reach their bottom this spring and gradually recover over the second half of 2024.”
What is the real estate forecast for Toronto in 2024? ›
Toronto Market Report Summary
The average selling price of a home in Toronto decreased by 5.0% year-over-year to $1,097,300 in July 2024. The average selling price of a single-family home in Toronto decreased by 4.2% year-over-year to $1,325,300 in July 2024.
Are home prices dropping in Toronto? ›
Toronto Housing Market Report. The Greater Toronto Area's benchmark home price for August 2024 was $1,082,200, down 4.6% year-over-year. The average home sold price in the GTA decreased 0.7% year-over-year to $1,074,425 for August 2024. Detached home average price decreased by 0.2% year-over-year to $1.41M.
What is the next 5 year forecast for real estate in Canada? ›
Overall, due to the economic slowdown in Canada, rates are headed downward. As a result, I predict that the real estate market will start seeing buyers come back purchasing properties during Q4 of 2024 and continuing so into 2025 and 2026.
What is the housing market prediction for 2025 in Canada? ›
Canadian Home Prices Forecast To Surge 20% Over 2 Years
Explosive growth is forecast for 2025 (+9.5%), seen moderating in 2026 (+4.6%). Their baseline forecast has the average existing home fetching $814,851 by 2026, or 20% higher than last year.
Will 2024 be a better time to buy a house? ›
Yes. This is the best time to buy a house in California. With the current trend in the CA housing market, you'll find better deals on your dream home during Q2 2024. As per Fannie Mae, mortgage rates may drop more in Q2 of 2024 due to economic changes, inflation, and central bank policy adjustments.
Are Toronto area buyers walking away from deposits? ›
Toronto-area buyers are walking away from deposits on new homes — some losing as much as $300,000. 'This is just the beginning,' say experts, noting buyers of new builds further from Toronto are most vulnerable. Updated Nov. 3, 2023 at 6:36 p.m.
Is it a good time to buy in Toronto? ›
With the current lull in demand for Toronto condos, prices have softened, creating a buyer's market. This scenario offers a prime opportunity to purchase properties at lower prices before the market rebounds. Investors with an eye on long-term gains understand that the present moment is ideal for securing a good deal.
Is it a good time to sell a house in Toronto? ›
Realtors say the spring market is considered the best time to be a seller followed closely by the shorter fall market. Toronto realtor Rahim Jaffer said the spring and fall markets are definitely a good time to be a seller rather than the winter and summer when there are lulls in the market.
Should I wait until spring 2024 to sell my house? ›
Best Time to Sell Your House for a Higher Price
April, June, and July are the best months to sell your house in California. The median sale price of houses in June 2023, was $796,400, which is expected to grow more in 2024. However, cities like Arcadia and San Mateo follow an upward trend throughout the year.
With the cost of Toronto houses in 2024 being so high, it's hard to invest in a house as a rental property (not impossible, just cash intensive). If you're thinking about buying a house in Toronto and whether it's a good investment long-term as you live there, it absolutely is.
What is the market prediction for 2024? ›
Analysts project 11.5% earnings growth and 5.5% revenue growth for S&P 500 companies in 2024. Fortunately, analysts see positive earnings and revenue growth for all eleven market sectors this year.
How much will a house cost in Canada in 2024? ›
National Market Report Summary
The average selling price of a home in Canada decreased by 3.9% year-over-year to $724,800 in July 2024.
Is Canada in a housing bubble? ›
Prices peaked in the Spring of 2022, and according to our analysis, many Canadian housing markets are already bursting bubbles. There has been a price turnaround, but purchases are well below the 10-year average. In a May Reuters poll, the average analyst expects Canadian home prices to rise 1.5% per cent in 2024.
Is it a buyers or sellers market in Ontario? ›
Real Estate Market
The sales to new listings ratio (SNLR) in Ontario was 40% during July 2024, indicating a buyers market. On a monthly basis, that's decreased by 2.6% compared to the previous month. Ontario's yearly sales to new listings ratio has decreased by 11.0% over the last 12 months.
What is the market outlook for 2024 in Canada? ›
We expect below-trend growth in Canada for 2024 amid potent monetary policy transmission which should contribute to continued progress towards lowering core inflation to a range of 2.1% - 2.4% at year-end.
What is the mortgage rate forecast for Canada 2024? ›
As of September 2024, 5 year fixed rates in the mid 4% range are approximately 0.75% – 1% lower than variable rates in the mid 5% range. So by locking into a 5 year fixed rate now, certainty for rate savings is guaranteed.
How much will a condo cost in Toronto in 2024? ›
The average condo apartment selling price in Q2 2024 was $729,005 – down by 1.2 per cent compared $737,925 in Q2 2023. In the City of Toronto, the average selling price was $765,963 – down by 0.5 per cent compared to Q2 2023.
