Canada's Home Prices Will 'Remain Elevated' In 2022 & The Next Few Years Aren't Looking Good
The affordability of homeownership is expected to "decline" in 2023 and 2024.
House in Alberta with a sign that it has been sold.
It's not looking good for potential homebuyers as Canada's home prices are expected to "remain elevated" this year and affordability will "decline" over the next few years.
According to the latest Housing Market Outlook released by the Canada Mortgage and Housing Corporation on April 21, the pace of price growth will stay elevated in 2022 when compared to long-term averages.
However, those costs will be moderate compared to peaks seen in 2021.
It's forecast that the average prices for homes in 2022 will range between $740,700 and $782,400 nationally.
CMHC said Ontario, Quebec and B.C. will likely see the strongest price increases this year but that growth is expected to slow by the end of 2024.
By late 2023 or early 2024, the growth of home prices nationally should be more in line with historical averages.
Even then, "elevated price levels will persist since price growth will remain positive," according to CMHC.
That is expected to put more pressure on the affordability of entering homeownership and that affordability is set to "decline" as price increases outpace income growth.
The changes in Canada's home prices will likely be led by housing markets in Vancouver, Toronto, Montreal and Ottawa.
CMHC predicted that average prices in 2023 will be from $743,000 to $831,100 and average prices in 2024 will range from $756,500 to $867,800.
As part of the 2022 budget, the federal government laid out a plan to make housing more affordable for people trying to buy their first home in Canada.
It includes introducing the Tax-Free First Home Savings Account, doubling the First-Time Home Buyers' Tax Credit, extending the First-Time Home Buyer Incentive, restricting foreign buyers and building more homes.
This article's cover image was used for illustrative purposes only.