The demand for housing continued to remain strong in 2023, thanks to a record number of immigrants. However, more of this demand was pointed at the rental market. The number of GTA home sales in 2023 came in at less than 70,000 due to affordability issues brought about by high mortgage rates.

There were 65,982 home sales reported in 2023, a 12.1% dip compared to 2022. Despite an uptick during the spring and summer, the number of new listings also declined in 2023. The population has been steadily growing, but the number of listings has remained flat-to-down over the past decade.

On a seasonally adjusted monthly basis, sales increased compared to November, while new listings declined for the third straight month.

The average selling price for all home types in 2023 was $1,126,604, representing a 5.4% decline compared to 2022. 

High borrowing costs coupled with unrealistic federal mortgage qualification standards resulted in an unaffordable home ownership market for many households in 2023. With that said, relief seems to be on the horizon. Borrowing costs are expected to trend lower in 2024. Lower mortgage rates coupled with a relatively resilient economy should see a rebound in home sales this year.

Buyers who were active in the market benefitted from more choices throughout 2023. This allowed many of these buyers to negotiate lower selling prices, alleviating some of the impact of higher borrowing costs. Assuming borrowing costs trend lower this year, look for tighter market conditions to prompt renewed price growth in the months ahead.

Record immigration into the GTA in the coming years will require a corresponding increase in the number of homes available to rent or purchase. People need to have comfort in knowing that they can plan their lives and future with the certainty that they will have the stability of an affordable place to live. This will impact buyers and sellers accordingly and if you are wondering how these market changes will impact you, please feel free to reach out to me with any questions.

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