Hello and Happy New Year!
I hope you have been able to enjoy the holiday season and found some time to rest and reflect on 2023.
In reflecting on the Residential real estate market for 2023 the number of Greater Toronto Area (GTA) home sales came in at less than 70,000 due to affordability concerns brought about by higher mortgage rates. This number represents the lowest number of transactions since 2001.
Higher borrowing costs resulted in an unaffordable residential market for some households in 2023. However, relief looks to be on the horizon with borrowing costs expected to trend lower in 2024. Lower mortgage rates, continued population growth along and a positive outlook of our economy should see a rebound in home sales this year.
There were 65,982 home sales reported through TRREB’s MLS System in 2023 – a 12.1% decline compared to 2022. Despite an uptick during the spring and summer, the number of new listings also declined in 2023. The trend for listings has been largely flat-to-down over the past decade, which is problematic due to a steadily growing population.
The average selling price for all home types in 2023 was $1,126,604, representing a 5.4 per cent decline compared to 2022.
The Toronto Regional Real Estate Board's Chief Market Analyst, Jason Mercer, stated recently that buyers who were active in the market benefitted from more choice throughout 2023, which allowed many of them to negotiate lower selling prices, alleviating some of the impact of higher borrowing costs. Assuming borrowing costs trend lower this year, look for tighter market conditions to prompt renewed price growth in the months ahead.
Record immigration will continue to play a driving role in the GTA's residential real estate market. There will be a perpetual need for real estate, rental or for purchase, as long as our population continues to grow at the pace in which it does. The development of new homes, freehold or condominium, will play a key role in providing the necessary housing supply required. Those with the means to invest in real estate will play a key role in replenishing the rental stock required to supply homes for those who rent. Developers will not build unless they sell their product first. As 2024 kicks-off, expect to see some never seen before promotions by developers who are selling their current standing inventory. As a brokerage we have access to these never seen before opportunities, please do not hesitate to reach out to me should you be looking to expand your real estate portfolio.
I wish you a fantastic 2024! Please know that I am here to assist you with all your real estate requirements throughout the year. If I can be a resource in any way, do not hesitate to contact me.
I look forward to connecting with you soon.
Kind Regards,
Chris Gregoris