Borrowing rates are up and so are sales prices while volume is down. Are you surprised? The recent trend continues as 5,038 homes sold in September, down from last year’s record levels. The average sale price also is up 10.7% since the start of the year to $1,212,963. It’s confusing, isn’t it? Prices are supposed to be down but yet are up. This disconnect is because prices increased 28% in February and March this year. Prices are averaging down slowly from those highs, as we expect to end 2022 with a 6-8% price increase over 2021.
This also explains why despite the negative news and borrowing rate increase the market continues to move forward. Some got lucky a few months ago and sold near the peak but in most of those cases, they also bought at that same peak. Trade-up buyers are seeing this as an opportunity to upgrade before prices make their next charge forward, and they will. Increases of 12-15% in rental rates combined with prices being off their peak have attracted investors back into the market.
Bottom line, Toronto and the GTAA is not likely to suffer any sustained value retraction. Living in and near Toronto there are always people on the move because of personal circumstances and of course immigration bolsters demand on top of that. The area governments are so far behind in creating a path to easing demand it will still take years to change the dynamics.
You’ll pardon me for beating the same drum again and again but there is a continuing shortage of available homes for sale for trade up buyers while downsizers are staying home longer. Therefore, the future of home valuations in the GTA remains extremely positive if we stay focussed on the long term.
What your best move is, and when to make it, remains a very personal question. So, talk to me about your needs and I promise you the most impartial objective advice. My interest and priority is to help you do what is best for you. Let me guide you through the intricacies and often confusing signals of the current market. Opportunities do exist whether you are buying or selling and the first one to say, “let’s wait,” will be me, if that makes the most sense for you and your family. The worst decision for you just might be, not to make any decision.
Let’s talk because you have a friend in the business who cares!
To A Good Life,
Sam Chaim - Making A Difference For You!