The Canadian Real Estate Association (CREA) has updated its forecast for home sales activity for 2023 and 2024. It’s predicting good news for the market in the coming year – not a full recovery, but the start of a market turnaround.
Home prices across the nation are a mixed bag, with some local markets being relatively affordable while others continue to struggle with affordability issues. Most markets have seen prices cool since their peak in early 2022 but are still well above where they were in 2020.
Despite price unpredictability and eight interest rate hikes in the last year, home sales have remained relatively stable since the summer – suggesting the shock from the Bank of Canada’s efforts to slow inflation is starting to fade.
According to the CREA, first-time homebuyers will still have a hard time entering the housing market until rates go down. However, increased borrowing costs will mean less competition in the market, and consumer attitudes may shift and become more confident once there’s reassurance that rates won’t be going higher anytime soon.
The national average home price is expected to decline by 5.9 per cent in 2023, making the new median home price $662,103.
The CREA predicts that approximately 495,858 properties will trade hands through Canadian MLS systems in 2023 – a 0.5 per cent decline from 2022. However, by 2024 the firm predicts home sales will rise to 546,625 units as markets return to normal.
