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📈 DECEMBER 2023 Market Watch

📈 DECEMBER 2023 Market Watch

The Greater Toronto Area (GTA) housing market faced a dynamic landscape in December 2023, according to the latest report from the Toronto Regional Real Estate Board (TRREB). Despite the challenges posed by high mortgage rates and affordability concerns, the market demonstrated resilience, with a focus on the rental sector driven by record immigration in 2023.

Demand Dynamics: While overall housing demand remained robust, a notable shift was observed, with a significant portion of it directed towards the rental market. Affordability issues, exacerbated by high borrowing costs and stringent federal mortgage qualification standards, led to less than 70,000 GTA home sales in 2023. However, TRREB President Jennifer Pearce expressed optimism, anticipating relief as borrowing costs are expected to trend lower in 2024, potentially sparking a rebound in home sales.

Market Statistics: In 2023, there were 65,982 home sales reported through TRREB's MLS® System, reflecting a 12.1 percent decrease compared to the previous year. Despite a spring and summer uptick, new listings also declined in 2023, presenting a challenge in the face of a steadily growing population. On a seasonally adjusted monthly basis, December saw an increase in sales compared to November, while new listings declined for the third consecutive month.

Price Adjustments and Buyer Benefits: The average selling price for all home types in 2023 was $1,126,604, indicating a 5.4 percent decline compared to 2022. Buyers in the market benefited from increased choices, allowing negotiations for lower selling prices amid higher borrowing costs. TRREB Chief Market Analyst Jason Mercer anticipates renewed price growth if borrowing costs trend lower in the coming year.

Future Outlook and Housing Stability: Looking ahead, TRREB CEO John DiMichele highlighted the necessity of addressing the growing demand resulting from record immigration. He emphasized the need for an increased number of homes available for rent or purchase to provide stability and affordability for residents in the GTA.

In conclusion, the GTA housing market is poised for change in 2024, with expectations of lower borrowing costs and a potential rebound in sales. As the market adapts to evolving trends, ensuring a balance between demand and supply remains crucial for sustaining the GTA's dynamic real estate landscape.