Hot off the press, the Toronto Regional Real Estate Board (TRREB) has just released its anticipated 2023 Market Outlook & 2022 Year in Review Report.
And we can expect some heightened activity in the city’s real estate market this year.
According to the report, the second half of the year will see a gradual uptick in home sales in the Greater Toronto Area (GTA), along with an increase in competition between buyers, with a renewed upward pressure on home prices. This is good news for sellers, of course, but -- in a climate of sky-high interest rates -- it only makes things more of a challenge for first-time homebuyers.
The report includes the latest Ipsos consumer polling results on buying and selling intentions, research from CANCEA on transportation infrastructure, and insights from the Pembina Institute on electric vehicle trends in Canada and the impact on real estate.
“It will be a year of two halves in 2023,” said TRREB Chief Market Analyst Jason Mercer. “The first half will feel similar to the fall of 2022 due to the lingering effects of higher borrowing costs and related economic uncertainty. However, recent polling by Ipsos suggests buying intentions are edging up. The second half of 2023 should be characterized by an increase in demand for ownership housing, supported by lower fixed mortgage rates, a relatively resilient labour market, and record immigration.”
Landscape view of Toronto downtown in winter.
According to TRREB, we can expect to see a total of 70K sales in the GTA in 2023. While this is still below the 2022 figures, the city will see a notable improvement in the second half of the year. According to the 2023 Market Outlook, the average selling price will reach $1,140,000 for all home types combined. TRREB says that this figure will be up from current market conditions forecast for the second half of 2023. The calendar year average price for 2023 will be 4% lower than the 2022 average price, says TRREB.
Ipsos findings reveal that buying intentions were up slightly compared to last year, with 28% of respondents indicating that they’ll consider purchasing a home in 2023. At the same time, listing intentions were also up for 2023 compared to 2022 for townhomes and similarly to 2022 condominium apartments and semi-detached houses. Listing intentions for detached homes appear to be trending lower, says TRREB.
Highlighting anticipated population growth in the Greater Golden Horseshoe (GGH) and the need for more housing supply and related infrastructure, TRREB says that it’s imperative that we account for the changing impact of climate change, including the risks associated with higher temperatures and property damage due to heavy winds and flooding. The report stresses that the future must focus on sustainable housing and greener homes.
“This is a wake-up call. We know there is a better way to build homes and communities,” said TRREB CEO John DiMichele. “We need a long-term vision with an eye on environmental sustainability from raw materials to green designs that will benefit, not burden, future generations.”
TRREB president Paul Baron highlights how the GTA and surrounding GGH are competitive globally in terms of economic, social, and cultural diversity. "This is why people and businesses want to move here in record numbers,” says Baron. “In order to sustain this growth, we need to ensure that we have an adequate and diverse supply of housing. This housing must be supported by the appropriate infrastructure. Recent policy initiatives at all levels of government seem to acknowledge this, but it’s time for these policies to actually translate into tangible results.”
