It is the most common question we hear from our clients: what do you see happening in real estate? The best way to explain what’s happening is by analogy.
 
Real estate is a living, breathing entity. It has good moods and bad, high points and low. As things change in the economy, the housing market responds.
 
Over the past nine months we have watched the fluctuations in the market. Home pricing reached its lowest point in January 2023 following multiple interest rate hikes last year, and then pricing began to creep up again. Between January and June of this year, prices climbed steadily in most western suburbs of the GTA and elsewhere.
 
Then, two subsequent interest rate hikes beginning in June had an immediate slowing effect. Within a few weeks of the first hike, the pace picked up again. However, the second hike in July had no measurable effect. It seemed as though the first increase was a shock to the system, but by the time the second rise occurred, home buyers and sellers had already been desensitized and things seemed to continue as normal.
 
Interestingly, the market slowed noticeably alongside the most recent announcement in September that the Bank of Canada rate would remain steady at 5%. This is where we are now. 

Counterintuitive? Maybe. Real? Most definitely.
 
According to TRREB Chief Market Analyst Jason Mercer, “GTA home selling prices remain above the trough experienced early in the first quarter of 2023. However, we did experience a more balanced market in the summer and early fall, with listings increasing noticeably relative to sales. This suggests that some buyers may benefit from more negotiating power, at least in the short term. This could help offset the impact of high borrowing costs.” (TRREB, September 2023).
 
Here's how things look in the market when comparing September 2023 with September 2022.

Detached Homes

 

Looking at detached homes in this selection of western suburbs, we see several different trajectories. Waterdown shows the largest increase year over year, followed by Ancaster. Burlington and Mississauga are basically flat year over year, and Milton, Oakville and Stoney Creek show measurable decreases. 

Waterdown in particular seems to show varying increases depending on which real estate board is providing the data. We noted that in some reports, Waterdown showed only a 9 or 10% increase, while the Toronto Regional Real Estate Board information indicated a 17% jump for the month of September versus last year. Big picture, Waterdown's increase year over year is certainly larger than the other regions.

That said, the data seems to suggest that consumers seeking detached homes have moved their money slightly west of Halton for the moment.

Freehold Townhomes

Freehold towns show a bit more consistency across the regions. The largest increases were found in Waterdown, Mississauga, Stoney Creek, and Burlington, while Milton and Oakville showed a relatively flat trend in average pricing. Ancaster was trending down in this market segment.

Condo Townhomes

Condo townhomes gained favour in some areas when compared to September of last year, while other areas faltered.

Waterdown, Milton, Oakville and Ancaster showed a very nice year over year increase in the average price of condo townhouses, while Stoney Creek, Burlington and Mississauga went the other direction. 

Condo Apartments

As the entry point for many first-time homebuyers, condo apartments will often buck the trend of other housing styles. Comparing average pricing from September 2023 with September 2022, the most striking difference is that any increases were more measured than they were in detached and townhouse properties.

Burlington, Oakville and Mississauga saw slight increases in average pricing year over year in the condo apartment segment, while Milton, Waterdown, Ancaster and Stoney Creek saw decreases.  

Conclusion

Reviewing the data, it's easy to see that the trajectories in average home prices are very dependent on housing style. Depending on what type of home you might be looking to buy or sell, and based on where you live, it's likely you will see things shifting in different directions and by varying degrees.

Is now a good time to buy? Without question. If you are looking to buy a property and you do not have one to sell, it's a great time to scoop up a great deal. If you own your own home now and are thinking about downsizing, the same reasoning applies.

Remember, real estate is all about the long term. Owning your own home and capitalizing on the equity while living there is always a good idea.

If you are considering buying or selling a home and you have not yet decided on a REALTOR®, get in touch with us today.***

References:
Toronto Regional Real Estate Board (2023). GTA REALTORS® Release September Stats.

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