The consensus appears that much of the Canadian housing market is poised for moderation, with several markets correcting more than others. But how has Toronto fared in 2022? This past summer might have cemented its fate for the rest of the year, which may be good news for prospective homebuyers.
Toronto's residential property sales saw a slight boost month-over-month, but tumbled at an annualized pace of 34.2 per cent in August. The positive aspect is that market conditions are more balanced compared to the previous year.
In August, condo prices rose 3.6 per cent to $711,321, while detached and semi-detached properties fell by 3.1 per cent. TRREB says more buyers are buying condos as they seek to offset the impact of higher borrowing costs.
Active residential listings increased more than 62 per cent in August, to 13,305 units. Months of inventory, which gauges the number of months it would take to exhaust current stocks at the present rate of sales activity, clocked in at 1.3. Industry experts believe that public policymakers at all three levels of government need to pass policies that bolster supply.
The Bank of Canada once again raised interest rates by 75 basis points at the September policy meeting. This, of course, is weighing on mortgage rates, home sales, and the overall Canadian real estate market. Crigger believes the federal government could make this inflationary, high-rate climate a bit more tolerable moving forward.
Whether the Toronto real estate market will correct further remains to be seen, but it is safe to say that the COVID-induced boom is done. For now, the days of bidding wars, blind bidding and double-digit price growth could be fading. The central bank has turned ultra-aggressive in its inflation fight, and parts of the national economy could be slowing down.