What to Expect From the Toronto and GTA Housing Market in 2024

If you haven’t heard the phrase that real estate buying or selling is more about timing than it is about money, then you will certainly read about it. Thanks for stopping by.

Canada and the world at large has experienced an incredible roller coaster market the past 3 years and even arguably before then. But in using the pandemic as a time to measure with and against is incredibly useful in determining where we are in any given market whether that is with stocks, bonds, interest rates and of course mortgage and housing costs.

In this post, we will highlight a few things to really keep an eye on because here at Selling Toronto, we believe in the resiliency of demand for housing in Toronto and the GTA (even at these elevated prices where the average price of a home sits between $1.1-$1.2M.

Interest Rates & Inflation

Obviously this has been the major story along with low supply of inventory particularly in single family homes over the last 5 years but we saw it hit a fever pitch in early 2021 and 2022 where families were moving to seek more space for their families, looking for additional amenities in a home like a backyard, a nice park nearby, a finished basement.

That was the explosion that caused many millennials and gen x to seek greener pastures, bigger homes and of course to take on more debt. Of course, this also coincided with record low interest rates that induced many to take on variable rate low cost mortgages - it was basically free money so why not right?!? And many of our clients took advantage of this while it lasted..

I’m sure it was anticipated that access to more money, cheap money and of course extra stimulus would add more money supply to the economy but what further exacerbated the problem was supply constraints, the unpredictable demand of consumers for products and homes when they were holed up in isolation and under lockdown. We couldn’t have predicted all of this, nobody could, and so now we have to deal with the consequences of our decisions.

So now that interest rates are back up to where they were when I first started in the business 13 years ago, except at that time rates were on a downward trajectory instead of a rapid upward one like we’re seeing now which again, also has its consequences and aftermath (see food bank usage). All signs at this stage in fall of 2023 point to possibly a slow down in rate hikes or just a complete stop which of course means, there will be a “buying season” for Toronto real estate once again.

In the last 13 years in Toronto and GTA real estate, we’ve seen a lot. Mostly of course it has been on an upward and aggressive climb especially during the height of the pandemic with super low interest rates, stimulus and stable employment for many. For the most part, it feels like the rates will largely stay where they are as it appears we are heading towards or are already into a mild recession. And it certainly feels like a recession in the real estate market over the past 2 years (2022-2023) all controlled and manipulated by interest rates, inflation and the BOC.

What we know about the Toronto and GTA housing market is it is incredibly resilient, incredibly strong as everyone wants to own a piece or several pieces of the Canadian dream. And while qualification for mortgages has become a lot tougher, it feels like the BOC and the FED in the US is largely done their rate hike cycle and perhaps rates will start coming down at some point in 2024 which of course as we know, will like re-ignite the housing market here.

Our Recommendation:

You should always look around and research several months before actually making a move. Buying a home in Toronto and the GTA is incredibly stressful when home prices are going up on a monthly or sometimes on a weekly basis through aggressive bidding, fighting and sometimes even unsavoury practices. Here at Selling Toronto, we focus on educating our clients, making sure they understand what is happening in the market at all times, understanding micro and macro economic impacts and helping our clients work through their personal finances to make sure buying the right home for them makes sense.

So you want to get into the market (hopefully) right before it bounces back and buy in a time and season when everything is a bit more chill, you can choose a beautiful renovated home instead of battling it out with 10 other offers for an average home. Unfortunately, market psychology and history tells us that buyers do not join the fray until they see or hear that the market has truly picked up but usually, by that time it’s too late. So to get on top of the market and have an edge and give yourself the best chance to choose an amazing home for you and your family, it’s always best to prepare earlier by several months and work with the right people - we can recommend a few here at Selling Toronto who would be happy to guide you on your homebuying or homeselling journey. Talk soon!

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