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Toronto-area housing market shows signs of recovery

CEO Khai Intela
The Toronto housing market is experiencing a gradual increase in prices, according to the Toronto Regional Real Estate Board. After a period of decline, prices have risen by four percent since March, bringing them closer...

The Toronto housing market is experiencing a gradual increase in prices, according to the Toronto Regional Real Estate Board. After a period of decline, prices have risen by four percent since March, bringing them closer to last year's levels. Although sales have decreased by 5.2 percent compared to last year, they have increased by approximately nine percent from March. This surge in sales, coupled with a drastic decrease in new listings, intensifies the competition among potential buyers.

In the early months of 2023, hesitant buyers stayed on the sidelines due to eight consecutive interest rate hikes, which reduced their borrowing power. As a result, prices started to tumble, leading to a sense of hesitance among sellers who were reluctant to list their homes at lower prices. However, recently, real estate agents have witnessed a shift in the market.

Desmond Brown, a Toronto real estate agent, explains that there was a brief window of opportunity for first-time home buyers between December and February. However, that window has closed, and multiple offer situations have become more common. Frustration arises from the limited supply of homes, as demand continues to rise.

New listings in April were significantly lower than in previous years, with a decline of 38.3 percent compared to the previous year. Additionally, the average price of homes in April was 7.8 percent lower than the previous year, reaching $1,153,269. Despite the overall decrease, detached homes fell by 8.3 percent, while semi-detached properties dropped by 9.8 percent. Townhouses and condos also experienced price decreases.

Looking ahead, experts have mixed predictions for the market. Jason Mercer, the chief market analyst at the Toronto Regional Real Estate Board, anticipates an increase in demand for home ownership throughout 2023. This is due to buyers adjusting to the Bank of Canada rate hikes and the strong regional economy that offers job opportunities.

James Laird, co-CEO of Ratehub.ca, suggests that while home prices have decreased year-over-year, they have recently shown a slight monthly increase. This indicates a potential stabilization or even a slight rise in prices as the spring and summer months progress.

On the other hand, Tony Stillo, director of economics for Canada at Oxford Economics, believes the spring pick-up in the market will fade as the nation slips into a recession. Although it is difficult to predict the exact timing, he suggests that prices may reach their lowest point later this year or early next year.

Overall, the Toronto housing market is showing signs of recovery, with prices slowly improving and sales picking up. However, the limited supply of homes continues to be a challenge. Buyers and sellers alike are advised to stay informed and seek professional guidance in navigating this dynamic market.

Real estate agent Desmond Brown said the amount of offers homes are receiving can make things frustrating for buyers. Real estate agent Desmond Brown said the amount of offers homes are receiving can make things frustrating for buyers.

The year-over-year price of condos is down eight per cent to $724,118. The year-over-year price of condos is down eight per cent to $724,118.

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