Stu Says – March 2023 Newsletter

As most of you know, I am more glass half full than glass half empty, and believe it or not – the real estate market in the GTA is improving!

Stop listening to all the doom and gloom out there from the media.  While it’s true that sales transactions are down 47% year-over-year in February – who cares? If Canadians chose to stay put and not sell their homes, then supply will remain limited and and housing prices will likely stay elevated. I was working in the real estate market in 1989-1991 when interest rates peaked around 18% and people were dumping their homes in record numbers to survive.  The difference now, is that people aren’t selling, and inventory isn’t increasing at a meaningful rate.

The real number to look at is the average price of a home in the GTA and where it stands month over month.  During peak pandemonium in Feb. 2022, the average price of a home in GTA was $ 1,334,062 – compared to Feb. 2023 where the average sale price in the GTA was down to $1,095, 617. That year over year drop from last February’s peak is roughly 17%, but telling number is that home prices have actually gone up since last fall. Here’s a quick look at monthly average selling prices from the last few months:

August 2022: $1,079,500
September 2022: $1,086,762
October 2022: $1,089,428
November 2022: $1,079,395
December 2022: $1,051, 216

Prices are actually up $44,401 since Dec. 2022 – an increase of 4.2 %. All this while interest rates have been rising. On March 9th, the Bank of Canada held their overnight lending rate steady, and indicated that they intend to maintain interest rates at these levels as long as inflation numbers continue to fall.

What does this mean?  The market is stabilizing.  Listing prices are more accurate. Buyers aren’t feeling the pressure as much, bidding wars are no longer the norm, and 2023 is going to be an even keel year without crazy ups and downs.

The real question is when will the market start heating up again? When will you miss my chance to buy at the bottom and get into the market? Give us a call to find out!