Real Estate in Ontario in 2022
2022 is here! What better way to kick off this year’s real estate content than a market update. Finding real estate in Ontario in the new year is going to be tricky. Especially, if you’re looking for something affordable. The trends in real estate in Ontario are certainly eye-opening! In this article, we will be going through predictions, Canada’s real estate stats, and what Ontario’s housing market looks like right now.
Continue reading below to find out more!
Canadian Market Overview
The Canadian housing market is a hot topic for discussion right now. Housing prices are steadily on the rise with inventory in all provinces rapidly decreasing. Many people once thought that the pandemic would cause a decline in real estate sales; however, it is becoming increasingly apparent that this is not the case. The real estate market has done what no one could’ve guessed.
RE/MAX predicted that of the 38 analyzed markets “97 percent of regions (37 out of 38) surveyed are likely to remain seller’s markets in 2022” (Canadian Real Estate Prices 2022). As such, finding affordable housing in Canada is becoming progressively more difficult. Canada is also projected to have over 1 million people immigrating between now and 2023. Thus, putting even more stress on the housing market.
Please view the full RE/MAX market report here!
To combat this, many provinces are working to create more affordable housing options for their citizens. Through incentivizing developers and encouraging homeowners to move, governing bodies are hopeful that some tension will be relieved.
Real Estate in Ontario 2022 Market Update.
Ontario has experienced a surge of growth in real estate sales over the past year. Much like the rest of Canada, Ontario is experiencing high housing prices associated with low inventory. Although, what sets Ontario apart from the rest of Canada, is the fact that it has the lowest inventory of any province in the nation. Which, is creating a showdown amongst people looking for houses and sellers driving the cost through the roof. The smallest of homes are going for unimaginable prices in areas just outside of Toronto.
Some officials say that the housing market in places like Ontario is beginning to shift. They claim that “the monumental price growth has reached a peak” (Ontario Real Estate Market Shifts). If this is correct, sellers need to be more accepting of the more-than-adequate offers they are receiving for their homes. Estate agents have reported that sellers have declined offers that would’ve given them a substantial profit on their home, in hopes of something better. Most of these folks now are regretting their decision as their home remains stagnant on the market.
Scotiabank published a report on the Canadian real estate market, summarizing the shortage of housing across the country. It was determined from data in 2020 that Alberta, Manitoba, and Ontario are the only 3 provinces below Canada’s housing per capita average. Moreover, the report denoted that 650,000 homes would be needed in order for Ontario to be in line with the country-wide average.
Affordability of Real Estate in Ontario.
Even as the market in Ontario rumoredly cools, housing prices are far from affordable. The average price for a home in Ontario is more than $800,000! Saving for a downpayment is a lengthy task for Canadians looking to get on the property ladder. It would take several years to muster up enough cash to put down on a home. Some approximate that it would take 25 years before being able to pay for a down payment at the high end of the spectrum.
In the summer of 2021, the government changed the mortgage stress test. The threshold jumped from 4.79% to 5.25%. In turn, this forces buyers to choose a more affordable home or save for a larger down payment. According to BMO, if you wanted a $462,579 home you’d need a $100,000 down payment with a household income of $100,000. Now with those same numbers in mind, you’d need 16,000 more for your down payment to afford the house. Or you’d be forced to choose a home that is $447,000 or less.
For more information on real estate in Ontario, be sure to contact us at the MYLIE Group today! We’d be happy to help you list your home for sale or find a home in the area. If you have any questions or concerns, feel free to reach out to us at any point during your day. Real estate in Ontario is the place to be!
We look forward to working with you in the near future!