March closes the first quarter of the year and is often considered the end of winter. Spring and summer are the prime months for real estate shopping when homeowners often decide to place their houses up for sale. We look at the data from last month to see whether there has been any shift in the market that would indicate whether this will be a beneficial year or whether consumers will need to be concerned. In Toronto, we notice two slightly differing directions.
Comparing this past month with March 2022, it appears that the real estate market is gradually readjusting to what the experts consider a normalcy. The average sale price last month is about 2% higher, which is a good thing. However, when you compare it to last year at the same time, it is still 14.6% lower than the previous March. Similarly, the days on the market have reduced for March 2023 but still remain high compared to last year.
Of equal importance to the statistics is the underlying reasons for the change.
The simple answer is that there are more potential buyers shopping. The demand comes from a couple of areas. Rental rates have recently increased significantly over the past couple of years. As this amount reaches an equivalent amount of what a homeowner would pay in mortgage, the individuals realize the better bargain in finding a place of their own.
External Factors Impacting the Toronto Real Estate Market
Another factor comes from across the border. U.S. Regional Banks have brought concerns into the financial market therfore this has pushed investors to buy US treasuries and pushed the bond yields lower. This influences the reduction in mortgage rates. So a financial downturn in our neighbor country has made at least a small impact on our country’s economy.
Lastly, at least at this point, is the influx of immigration. New families will require housing, and with rental charges close in price to a mortgage, many people will opt for this route.
None of this means that qualifying for a home loan is now a snap. It is still difficult in some circumstances. At this point, there is no indication that the Federal Government will adjust the standards, and there are still a significant number of people who have not as yet seen their renewal information.
Navigating the Future of Toronto Real Estate
What’s next? To begin with, we need to see if the homeowners who were expecting real estate prices to increase and waited to put their houses on the market will decide to go ahead with the process.; if the economy can handle the higher asking prices, and if there will be fewer days on the market. Look to the Bank of Canada. Expectations are that rates will be stable for the near future, but that will depend on overall inflation.
If you find that you are among the group who is seeing the advantages of home ownership, especially as a first-time purchaser, the best place to start is with easyhouseloan.ca. They have staff who are qualified and able to keep a careful eye on the market and economics to provide the best advice at the time. In addition, they have access to a wide range of lenders and can help you overcome some of the obstacles commonly associated with mortgage applications. It is a winning combination for you.