By: The Goldfellas

May 2022 Market Update

Tags: REAL ESTATE NEWS, MARKET UPDATE, GTA REAL ESTATE

This May, GTA real estate saw an average sale price of just over $1.2M — a 3% decline from April’s sales — as increasing mortgage rates continue to push buyers to the sidelines.

This marks a nearly 10% correction since February’s all-time record of $1.33M, signifying the market’s serious reaction to the Central Bank’s imposed interest rate hikes. However, despite this shift, prices remain almost 10% higher than last May.

Although housing demand will continue to be supported by high employment rates, high job vacancies, increasing incomes, and record immigration, the current “waiting for the bottom” frame of mind is likely to continue throughout the summer, until rate hikes slow down later this year.

Conversely, the rental market is seeing a giant upswing as buyer affordability is taking a hit, with many rentals seeing multiple offers as tenants compete to secure a home.

This presents an opposing force to the price corrections, as the break-even point for investors to earn a profit on rental properties will now rise, making it more attractive for speculators to enter the market. 

In general, the collective point of view is that this situation of rising rates and high inflation is only temporary, and in due time the main issue of lack of supply will continue to define our real estate market. Thankfully, legislators are realizing that this is where the solution lies, and we should look forward to seeing some targeted platforms as we move into the fall elections.



 HERE'S WHAT HAPPENED LAST MONTH IN THE GTA: 

• Greater Toronto Area REALTORS reported 7,283 home sales in the GTA; a decrease of 38.8% compared to May 2021. 

• There were 18,679 new listings in the GTA; an increase of 0.5% compared to May 2021.

• The average selling price for all home types reportedly increased by 9.4% compared to May 2021. 

• The average condominium apartment price increased by 12.9% compared to May 2021. 

“Price trends observed over the past three months — both in terms of moderating annual growth rates and the recent month-over-month dips — are in line with TRREB's forecast for 2022. After a strong start to the year, the current rate tightening cycle has changed market dynamics, with many potential home buyers putting their purchase on hold. This has led to more balance in the market, providing buyers with more negotiating power” ~ TRREB Chief Market Analyst Jason Mercer

STAY TUNED FOR NEXT MONTH'S REPORT WHERE WE’LL SEE WHETHER THE BUYER SENTIMENT CONTINUES THE DOWNWARD TREND!

Is now the time to buy? It might depend on what your desired areas and budget are. Is now the time to sell? YES.

Think you’re ready to start looking? Download our Home Buyer’s Guide here, and check out our home search function here!

What should you do if you’re thinking about selling? Check out our Home Selling Guide here and give Zubin, Mansoor or Karl a call. Market conditions are changing quickly, but we have you covered. Let us make a plan that works for you based on price, location and timelines. We know our market and we’re here to help.
 

Read the full TREBB report here.

Reach Out Today! We have you covered.
Email us at info@thegoldfellas.ca

Zubin Abuwalla | Direct: 416-389-8019
Mansoor Ahmed | Direct: 647-297-1721
Karl Abuwalla | Direct: 647-883-0874Enter Blog Post Here

 

1 Message Us On Facebook Message us on Facebook!
close