Everyone was hoping that with the start of a new year, January 2023 would prove more favorable to the housing market. However, it seems as though we are on a repeat cycle with continued high interest rates, lower price trends, and still an extended time of properties on the market.
Comparing January 2023 with December 2022, the average sale price and numbers of properties sold remained steady. Comparing these months with a year ago, the statistics are significantly lower. Looking at the actual numbers for January 2023 against the same month a year ago, we find that sales are down almost 45% and the average price is down around 16%. Listings increased by a whopping 124% and the corresponding days on the market increased by a similar 123%.
Implications for the Housing Market
According to the governor of the Bank of Canada, interest rates are likely to remain stable for the present but certainly no reduction in the rates.
All of this indicates that there will be continued difficulties for home buyers to qualify for mortgages. An additional factor is those homeowners who have an adjustable mortgage rate who are now feeling the pinch of an increased monthly payment. There is a significant concern about their abilities to stay current with payments. Many people are worried about the potential collapse in the real estate market in Etobicoke, the GTA and throughout Canada.
Policies have been enacted to make housing more affordable, but these actions have only increased the number of houses available for sale. The policy changes have done nothing to help potential buyers to qualify. It appears that all levels of government are blind to the real problems. In the real estate and lending industry, we recognize that, in general, a buyer can qualify for a mortgage that is roughly four times greater than their income. At this point, the average price of a home is $1 million or more. With that formula, a household needs to have an income greater than $250,000. Under that scenario and with the current economy, there are few potential buyers with that level of purchasing power.
Still, there are various reasons why an individual or family will want or need to buy a home today. When that happens, the best choice is to seek the advice of a skilled mortgage broker.
Customized Financing Solutions for Residential and Commercial Properties
Easyhouseloan.ca is one of Ontario’s leading teams of professionals who are able to navigate the situation for these buyers. They have teams who regularly deal with securing financing for residential or commercial properties at fixed or variable rates as well as refinancing and dealing with home equity lines of credit.
Our staff monitors the mortgage rates and are able to identify the best rates for each individual circumstance. Our specialists have access to a wide array of lenders. That is why we are happy to work with anyone to find the best combination of terms, lenders, and rates. Our customers include those with excellent credit ratings, those will bad credit, or even no income. We have dealt with second or even third mortgages.
If you are interested in property in or around Etobicoke, or would simply like to discuss availability, contact our mortgage brokers in Etobicoke. We will be happy to have one of our representatives listen to your situation and offer suggestions.