January 2024 - Beginnings of GTA Market Shift
Tuesday Jan 23rd, 2024
GTA Real Estate Market Update: January 2024
The volume of home sales has trended down dramatically since the Bank of Canada started raising the Overnight rate (Prime rate) in March of 2022.
But things started to shift at the end of last year.
RBC reported that the Toronto-area market woke up from its slumber as 2023 drew to a close. Home resales spiked 21% in December.
RBC also made some rate predictions in the same report stating that by the end of this year, they anticipate the BOC rate to drop from 5% to 4% and then to drop to 3% by 2025.
If history is anything to go by, then as these rates drop, house prices will increase.
Affordability has been a major challenge for many Canadians who have been trying to buy their first or next home.
But holding off and waiting for predicted rate reductions may not prove to be the best strategy.
In the real estate industry, there is a saying: “You Marry the Price, but you Date the Rate.”
Put simply, it means that rates will change over time, but the price you paid for the property will always be the price you paid.
As it relates to the current market, this means that you may want to seriously consider the possibility that prices in the GTA have reached their bottom. And while interest rates are not as attractive as they were a few years ago, they are predicted to get lower.
Properties that had been sitting on the market for weeks or months are now selling, we’re even seeing a few in multiple offers (even in -20 degree weather)!
Now may be the time to ‘marry’ a Purchase Price and ‘date’ an Interest Rate that will allow you to purchase at today’s prices before prices start to inevitably increase.