Whether you are buying or selling a house, it is important to know the current real estate market trends and the market performance to make the right decision. So here is the real estate market update for the month of August 2022.
There were 5,627 home sales reported through the Toronto Regional Real Estate Board (TRREB) MLS® System in August 2022, representing a year-over-year dip of 34.2 percent – a lesser annual rate of decline compared to the previous four months. The August sales result also represented a month-over-month increase compared to July.
“While higher borrowing costs have impacted home purchase decisions, existing homeowners nearing mortgage renewal are also facing higher costs. There is room for the federal government to provide for greater housing affordability for existing homeowners by removing the stress test when existing mortgages are switched to a new lender, allowing for greater competition in the mortgage market. Further, allowing for longer amortization periods on mortgage renewals would assist current homeowners in an inflationary environment where everyday costs have risen dramatically,” said TRREB President Kevin Crigger.
“The Office of the Superintendent of Financial Institutions (OSFI) should weigh in on whether the current stress test remains applicable. Is it reasonable to test home buyers at two percentage points above the current elevated rates, or should a more flexible test be applied that follows the interest rate cycle? In addition, OSFI should consider removing the stress test for existing mortgage holders who want to shop for the best possible rate at renewal rather than forcing them to stay with their existing lender to avoid the stress test. This is especially the case when no additional funds are being requested,” said TRREB CEO John DiMichele.
“There are other issues beyond borrowing costs impacting housing affordability in the Greater Golden Horseshoe. The ability to bring on more supply is the longer-term challenge. However, we are moving in the right direction on this front. The strong mayor proposal from the province coupled with the recent commitment from Toronto Mayor John Tory to expand ownership and rental housing options are examples of this. TRREB looks forward to hearing additional initiatives from candidates vying for office in the upcoming municipal elections,” said TRREB Chief Market Analyst Jason Mercer.
The average selling price was up by 0.9% compared to August 2021 to $1,079,500. Less expensive home types, including condo apartments, experienced stronger rates of price growth as more buyers turned to these segments to help mitigate the impact of higher borrowing costs.
Apart from the overall real estate market trend, it is important to know the area-wise trend as well to invest in the right place.
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