Last Friday we attended the Toronto Regional Real Estate Board’s 2023 Market Outlook. Here is what we learned.
Increased immigration and higher borrowing costs are the two primary forces that will shape the 2023 Real Estate Market across the GTA.
TRREB predicts 70,000 homes will be sold in 2023. Fewer than in 2022, largely due to a slow start to the year followed by more sales in the second half of 2023.
TRREB predicts the average price (across all home types) for the year will be $1,140MM which would be higher than in the second half of 2023 yet 4% behind 2022’s overall average.
Ipsos Polls indicated that:
Buying intentions are up slightly over last year with 28% surveyed intending to make a purchase in 2023.
The number of First-Time Home Buyers intending to purchase in 2023 has increased from 39% to 46%.
Listing intentions were up over 2022 among townhome owners and similar for condo apartments and semis but detached homeowners are less likely to sell in 2023.
Increased immigration and borrowing costs will keep the rental market competitive and rent. Rental vacancies will trend lower leading to increased rents for tenants.
The INTEREST RATE OUTLOOK is positive from TRREB’s perspective predicting that if inflation eases as we move through the year that rates will flatten and point downward by year's end.
THE BOTTOM LINE
For SELLERS: While you won’t see the enormous month-over-month price gains we saw during the pandemic, a more balanced market with more buyers entering the market will be beneficial as we head into the second half of 2023.
We’re already starting to see competition pick up on certain properties due to limited supply.
For BUYERS: A more balanced market allows buyers to better set expectations and pricing is much more affordable compared to a year ago. TRREB’s outlook on interest rates also provides comfort. A balanced market provides First-Time Homebuyers more opportunities to get into the market.