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We are heading into the holiday slow down and that gives me pause to reflect on the many blessings that have come my way. I am blessed and grateful to be in a loving family, to live in a wonderful city and country, to have the freedom others just dream about, to be generally healthy and financially comfortable. I am also grateful for our friendships and business relationships and your support of what I do over the years. Whether that be as little as agreeing to receive my emails or as much as using me as your agent and most referred realtor, it all counts and I thank you for it. Whatever your plans, enjoy the next few weeks!!
Unlike Rudolph, my real estate nose is still working well, masked or not and so here's the latest news and my thoughts:
If the real estate market we are in is different, can we expect the values to be the same as they once were? I think not, but that doesn’t mean to say it’s bad news.
Consider that Toronto real estate board members sold 4544 homes in November. As of November 30, the average price of a home sold is $1,242,793 compared to January 1, 2022, where the average price was $1,079,395. For perspective, pre-pandemic at the end of November 2019, the average price was $843,637. In a “normal” market based on past years we would expect about 6,000 homes to be sold, so while we are down from that number it’s still a pretty good month considering the multiple increases in borrowing rates. The number of available homes for sale remains very low at just under 12,000, a tight market. This helps to supports the pricing levels we see today.
Premier Ford’s recent statement that 3,000,000 new immigrants are expected into Ontario over the next 10 years, highlights the value proposition for home ownership. Homes in the GTA can only go up Long-term. Despite the government’s announced plans to increase housing supply through the “More Homes Built Faster Act”, I am not overly optimistic that the good intentions will soon result in a supply increase. The bureaucracy and red tape of governing bodies in Ontario cause change to be a slow and somewhat painful process. Expect home prices in the GTA to reverse course and rise in the new year, although slowly. Caveat to that is…. provided the economy and unemployment remain positive.
Notwithstanding the challenging times the 4544 sales in November and the expected 4,000 home sales in December underscore the fact that people can still qualify under the higher mortgage rates and are taking advantage of the reduced competition to buy a home.
If you qualify to buy, this is the time to step up because of the lower prices than 1 year ago. Consider that a home last year at $1,7million with lower borrowing costs will carry for virtually the same as a home today bought for $1,5. We are at, or very near, the peak of interest rate hikes and expect rates to decline over the next 24 months. So, If you need financing, consider a variable rate mortgage so that you can lock in down the road when rates are lower. At the same time, in the GTA, in my humble opinion, expect prices to rise due to demand. Whether buying that bigger property or purchasing an investment property, now is an opportune time to explore those options.
It’s at times like these having a friend in real estate really pays off! And I am here for you. Talk is free but never cheap, so give me a call to talk about how 2023 can be a better year for you and your family through real estate.
All the best over the holidays season. Wishing you and your family good health and happiness in 2023.