Home price correction ``one of the most severe in the past half-century'' has already seen prices fall for a fourth straight month in overheated Greater Toronto area markets. may become. A new report from RBC warns.
New data released last week by the Toronto Regional Real Estate Board (TRREB) reveals average benchmark home prices in the GTA fell 6% month-over-month We did - $1,074,754 for the month of July.
Sales were also down a staggering 47% from July 2021.
Hogue said prices are likely to continue to fall over the next few months as more price hikes are slated.
This forecast runs counter to a report from his Royal LePage last month, which made sellers' forecasts more optimistic . After a slight decline in the second quarter, it declined for the rest of the year.
"Our forecast for further rate hikes by the Bank of Canada is to raise the overnight rate by another 75 basis points by the fall, which will continue to cool the market in the coming months," Hoag said. Stated. “We expect the recession to intensify and spread further as buyers take a wait-and-see approach as they see the impact of rising lending rates. Those surrounding areas are most at risk in light of overstretched affordability and unusual price increases during the pandemic.”
Since March, the Bank of Canada has It has raised lending rates by 225 basis points, to a 40-year high, warning that further increases will be needed given inflation remains near.
Hoag noted in the report that housing adjustments are "currently widespread across Canada," but that they are particularly noticeable in the expensive markets of Toronto and Vancouver.
In fact, Hogue said Toronto's home resale activity is at its slowest pace in 13 years except early in the COVID-19 pandemic.
The stockpile of available housing has also increased by 58% from a year ago, he noted.
"With more options to choose from, rising interest rates and shrinking purchasing budgets, buyers are able to extract meaningful price concessions from sellers," he said, adding that the GTA housing average Prices are down 13% from March. “Buyers are expected to remain on the defensive in the coming months as they deal with rising interest rates and low affordability.”
Hogue said Toronto City condos “ It is likely to remain relatively resilient," he said, but said prices would continue to fall elsewhere, particularly in the "905 belt, where real estate prices skyrocketed" for the foreseeable future. rice field. during a pandemic. ''
His July data from TRREB suggest that average home prices in the GTA are up 1% since July 2021.'' I'm here.