2024 MARKET OUTLOOK

& YEAR REVIEW

Toronto Regional Real Estate Board 2024 Market Outlook

 The direction of mortgage rates is key to where the housing market is headed in the Greater Toronto Area (GTA). TRREB is forecasting that:

- Home sales will reach the 77,000 mark in 2024, marking a substantial improvement compared to the less than 66,000 transactions in 2023.

- The projected average selling price will move closer to $1.17 million this year. This would be the second highest mark on record but still below the 2022 peak.

 

2023 Year in Review: A Look Back

Sales, prices, and new listings results in 2023 showed decreases when compared to 2022:

- Home sales dropped 12.1% from 75,047.

- New listings in 2023 were down 8.6% to 142,233.

- The average price of $1,126,604 for all home types decreased 5.4% from $1,190,749

Market Outlook Report 2024
2024 Outlook Slides

While buying intentions were flat or slightly down at the end of 2023, lower borrowing costs in 2024 are expected to increase the demand for ownership housing. GTA home sales are expected to reach 77,000 in 2024, marking a substantial improvement compared to less than 66,000 transactions in 2023.

New Homes & Condos Review and Outlook

According to Altus Group, 2023 new home sales got off to a slow start, following the trend of the last half of 2022. The highlights are:

- New condominium apartment sales bore the brunt of the slowdown in 2023.

- Benchmark prices slipped by over 15% since their peak in early 2022.

- If the Bank of Canada holds and possibly lowers interest rates, stronger demand in the new homes market will likely occur

Expect sales activity to remain sluggish through the first half of 2024. If the Bank of Canada holds and possibly lowers interest rates, some pickup will likely occur afterward. However, due to elevated prices and higher carrying costs, affordability concerns will continue to weigh on purchasing decisions.

Immigration Will Drive Sales and Price - Approximately 500,000 newcomers are targeted to settle in Canada annually by the federal government over the next three years. Many of these people will settle in the GTA – historically, Canada’s single greatest metropolitan beneficiary of immigration. This influx of population will result in growing demand for housing broadly – both rental and ownership.

Accelerate and Lower the Cost of Construction: Government charges can represent over 31% of the total cost of building a home in major cities, according to CANCEA. While efforts have been made to reduce costs, there is a compelling need for additional measures to expedite and reduce the cost of construction for affordable housing units.

The Consumer Price Index (CPI) rose 2.9% on a year-over-year basis in January 2024, following a 3.4% gain in December

Commercial Market - Looking Ahead

Altus Group reported varying trends in the commercial market for 2023. Highlights include:

- GTA office transactions declined.

- Industrial market conditions remained tight as demand for modern facilities outpaced supply.

- Increasing demand for purpose-built rentals is creating a resilient market.

 

As 2023 wrapped up, investor confidence in the GTA market persisted. Altus Group’s Q4 2023 Canadian CRE Investment Trends insight noted that Toronto remained one of the top three preferred Canadian markets amongst investors, with Vancouver taking the top spot and Ottawa coming in third.

While the lingering effects of inflationary pressures have resulted in a slowdown for all sectors, the increasing demand for purpose-built rentals and modern industrial facilities, supported by strong underlying demographic and economic fundamentals, is creating a robust and resilient real estate market in the GTA. Overall, investment remains strong with the anticipated end of higher and possibly lower interest rates in 2024.

Please contact our team at 647-298-1234 for any property services including buy, sale, new pre-constructions projects /assignment sales, free property evaluation service and other property services.

9120 Leslie Street #101, Richmond Hill, ON, Canada
+16472981234

Share on social

Share on FacebookShare on X (Twitter)Share on Pinterest

leungchristina.com