Greater Toronto Home Prices Drop Back to 2022 Levels
Credits: Toronto Real Estate Prices Drop As Market Loosens At A Breakneck Speed

Greater Toronto Home Prices Drop Back to 2022 Levels

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Greater Toronto Home Prices Reverse 2022 Gains

Home prices in the Greater Toronto Area have erased all the gains made earlier this year, according to new data from the Toronto Regional Real Estate Board (TRREB). The benchmark price for residential properties dropped over $22,000 in November to $1.08 million - virtually unchanged from November 2021.

Demand Slows As Listings & Inventory Rise

The cooling housing market is being driven by waning demand amongst homebuyers and investors. Sales dropped 6% in November to just over 4,200 units - one of the slowest paces on record. At the same time, new listings surged 16% higher to over 10,500 units. This influx of new supply is arriving over twice as fast as new sales, swinging leverage towards buyers.

Market Conditions Could Force More Homeowners To Sell

As home values retreat and mortgage rates rise, many current homeowners may struggle to afford to stay in their properties. Falling home prices, higher interest rates, or inability to refinance may force more people to sell and move into rentals.

Rental Market Demand Expected To Surge

As the for-sale housing market sees a significant correction, the multi-family rental apartment sector is poised to stay resilient due to the high demand for rentals. Displaced homeowners and priced-out buyers flooding into rentals will buoy occupancy and rents. Investors may begin shifting their focus to apartments as the ownership market downturn accelerates.

Historic Pace of Market Slowdown

According to TRREB’s sales-to-new listings ratio, the market has moved decisively into buyer’s territory. The 40% ratio in November signifies a major oversupply at current prices. One economist called this rapid shift "one of the fastest collapses in exuberance" in recent memory.

After months of fierce competition last year, the investor frenzy reliant on easy leverage has retreated almost as quickly as it arrived. Now, prices must either drop to what end users can afford or another wave of cheap financing could spur renewed speculative investing.?

Opportunity In Multi-Family Rentals Ahead

As the housing correction continues, multi-family rentals will be a relatively bright spot. For investors, this may present a generational opportunity to acquire apartments at high occupancies and attractive cap rates.

If you would like additional information on capitalizing on the impending housing crisis by investing in multi-family properties, contact me at (604) 613-1693? or [email protected]

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Credits: Toronto Real Estate Prices Drop As Market Loosens At A Breakneck Speed

#realestate #torontorealestate #housingmarket

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