Ontario Home Prices are Finally Coming Down: A Decrease of 9.2% !

Ontario Home Prices are Finally Coming Down: A Decrease of 9.2% !

The real estate market in Canada's largest city is experiencing a significant decrease for the first time in two decades. According to the latest data from CMHC (Canada Mortgage and Housing Corporation), as of December 2022, the average price of homes in Toronto and North York has declined by 9.2% compared to the same time-period in the previous year. This is a notable drop and has caused concern among homeowners, real estate agents, and mortgage lenders.

Several factors are responsible for this drop in home prices in Ontario. Firstly, the COVID-19 pandemic has had a significant impact on the economy, leading to job losses and reduced income for many families in this province. This has spooked some potential buyers and resulted in a decline in demand for homes. Additionally, the pandemic has caused many to reconsider their housing needs, leading to an increase in the number of condominium units for sale.

Other factors contributing to the fall of home prices are increased regulations and taxes on the real estate market. In the past 12 months, the federal government introduced several measures to cool down the then overheated housing market, including the Non-Resident Speculation Tax and the Foreign Buyers Tax. These taxes have made it more expensive and nearly impossible for foreign buyers to purchase properties in Toronto and further disrupted the supply and demand balance in the market .

But perhaps the biggest impact has been caused by increases in interest rates. In 2022 Canadians witnessed four rate hikes and the Bank of Canada's prime lending rate currently sits at 6.7%. The higher interest rates have made it a lot more difficult for buyers to qualify for a mortgage and lowered the demand for residential properties. Higher rates have also made it more expensive to refinance mortgages, leading to a decrease in the number of refinancing transactions.

It is not all bad news for homeowners in the GTA and the surrounding suburbs, despite the decrease in prices in Ontario, the real estate market remains strong in this city. Toronto is still a desirable place to live and enjoys a strong economy. Additionally, the decline in home prices will eventually bring potential buyers back to the market, providing them with an opportunity to own a home in Toronto.

To conclude, homeowners, real estate agents, and potential buyers should keep a close eye on the market, as the situation may change in the coming months and years.

Work With Us

We're looking for passionate, driven, and proven go-getters who have a desire to take their business to the next level. We want individuals who will exemplify our team philosophy and embody our core values of Integrity, Knowledge, and Results. Join us for intense training, nurturing mentorship, and peer support in a state-of-the-art facility designed to offer a modern curriculum of real estate education with hybrid hands-on training and direction.

Follow Us on Instagram