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Full 2024 Real Estate Forecast

Despite record high interest rates in 2023, demand for housing in the Toronto region remained high due to an influx of immigration. Much of that was directed towards the rental market, as home sales in the GTA were less than 70,000 due to affordability issues. What remains to be seen is what will happen to home prices and affordability in 2024 as supply and demand factors will continue to have conflicting effects. 

 

In the midst of these trends here’s what experts are saying we could expect in 2024:


  • Sales volume is predicted to remain sluggish for the first start of 2024 until interest rates might begin to come down

  • Due to current supply and demand factors prices will most likely remained balanced and flatten out in the first quarter rather than decrease

  • Mortgage rates and borrowing costs are forecasted to trend lower in the latter part of the year

  • Buyer sentiment will have a significant impact on prices in 2024 as many will take a wait and see approach for interest rates to come down which will directly impact the number of active buyers

  • The average selling price for all home types in 2023 was $1,126,604, representing a 5.4% decline compared to 2022, but prices still remain high for many households

  • Until interest rates begin to decrease, active buyers will still benefit from more choice and less competition

  • Because of high borrowing costs and an increase in the price of material, new home construction slowed down in 2023 and housing starts are predicted to pace even slower in 2024

  • Premiere Doug Ford’s government while entering the third year of the promised 1.5 million new homes to be built in Ontario, has yet to achieve the annual pace needed 

  • The condo segment continues to be in rougher shape due to the fact that it is investor fuelled and many will continue to offload properties as covering costs remains difficult

  • A new CBC report states more than half of GTA condo investors are losing money on properties

  • The proposed 10.5% residential tax rate hike will come into effect this February adding approximately $321 annually to the average household

  • Aggregate home prices are forecasted to potentially rise 6% over the course of 2024 to an average of almost $1.2 million

  • Single family detached homes are forecasted to rise 7% and condominiums by 5%

  • Renewed price growth and demand will largely be in part to population increases and decreasing borrowing costs as more buyers will enter the market


Sources: TRREB, CBC, TD



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