Toronto's Home Prices Could Drop By Over 11% In 2023 & Buying A House Will Be Way Less Bleak

Good news, first-time home buyers! The 6ix's housing market may be a hostile environment for buyers right now, but according to a new report by RE/MAX, Toronto house prices are set to drop off big time in 2023.

The real estate company's 2023 Housing Market Outlook predicts that rising interest rates will cause the GTA's market to slow down for buyers and sellers in the new year.

The province's sky-high inflation is also significantly impacting first-time buyers, many of whom are choosing to hold off on purchasing property due to a lack of affordability.

The pause is causing future construction projects to be delayed and a "widening gap" to be formed between "market prices and construction costs, including the impact that higher interest rates have had on financing these projects," the report adds.

But, it's due to these economic pressures that Toronto's luxury market will likely continue to cool in 2023, and the average sale price of residential properties in the GTA will decrease by 11.8%.

The report also found that 40% of the province's regions are currently considered "balanced markets," including Toronto, London, Kingston, and Windsor, while Hamilton, Brampton, Mississauga and Niagara are considered "buyer's markets."

"The pandemic years between Spring 2020 and early 2022 were outliers in terms of pricing and demand and factoring out those years in assessing what lies ahead for the region is important as we slowly tilt back to a post-pandemic recovery," Christopher Alexander, President, RE/MAX Canada, states in the report.

"This moderating market is an opportunity for homebuyers to take the time to consider their needs, assess opportunities patiently and ultimately make a wise purchasing decision and investment in the long run," Alexander adds.

This article's cover image was used for illustrative purposes only.