Real Estate Market Outlook 2023
Friday Feb 03rd, 2023
Canadians are understandably hesitant to engage in the market currently and as per an annual forecast from Remax, trend will remain the same in balance of 2023. As compared to 49% in 2021, current report reveals that 73% Canadians still see real estate as a solid long-term investment. In sharp contrast to 2022, most regions analyzed in the report will experience more balanced conditions in 2023. Also, another report from RE/MAX Canada reveals that homeowners are well-positioned to ride out the coming storm in large part due to lower loan-to-value ratios on new mortgages. Three factors were largely responsible for the downward pressure on loan-to-value ratios over the past decade: equity gains, the pandemic facilitating the ability to work remotely in smaller markets, and the transfer of intergenerational wealth, particularly in the latter half of the last decade and the early 2020s.
New construction projects are expected to get delayed because of the widening gap between market prices and construction costs, including the impact that higher interest rates have had on financing these projects. Overall, average residential sale price in the GTA is expected to decrease in 2023 by 11-12% as per this Remax report. However, majority of this hit will be taken by luxury market of 2.5 million plus range, which will continue to cool in 2023 due to economic pressures and affordability issues which will discourage prospective homeowners looking to upgrade. This in turn will negatively effect entry level housing supply as lesser Seller’s will be selling. So, range of housing costing around 1 Million mark is expected to see a positive growth due to higher demand then supply available.
Lately, GTA Real estate market is bit stable at start of 2023 with reasonable balance between buyers and sellers in market. Reasonably priced Inventory of homes & condos is moving fast with lesser inventory in market which is over 30 days old. Most of the stagnated ones are due to overpricing issue; as still many sellers are not able to adjust to demand of this new market. Having too many or big price changes is also not a good strategy from sellers prospective as it communicates to Buyer that Seller is getting desperate; resulting in a low ball offer, which most of the times just leads to a wasted opportunity. Pricing it right from beginning after doing a 30-60 days comparative market analysis to help derive the true current value.
Experienced Real estate broker can help both buyers and sellers setup right expectations based on current market, property condition, pricing and competition. All these factors mostly vary in every real estate transaction. Call me directly @ 416-738-7331 if you are planning to Buy or Sell or even if you’ve any general question related to southern Ontario real estate. I’m your real estate resource with 15+ Years of firsthand experience and local market knowledge you can tap into with just one phone call.