Like many countries during the pandemic, Canada saw huge price increases for both sales and rentals as borrowing rates plunged to record lows, taking inventory with them. In the midst of a bruising election campaign in 2021, Prime Minister Justin Trudeau’s Liberal Party of Canada took a swing at a housing crisis that was becoming a political crisis.
It is always a good time to buy. Right now, home prices are lower than they have been in years. Yes, the interest rate cost is higher, but if renting is your alternative, you are essentially paying a 100% interest rate. None of that money is going towards providing you equity or any sort of return. Outside of providing you with a roof over your head, of course.
The drop in housing activity due to soaring interest rates may be stabilizing in Toronto in what is expected to be a quiet fall market across Canada, according to a new RBC report. As market activity remains well below pre-pandemic levels countrywide, the report says the last four months have been “very quiet” in Toronto, indicating the sharp declining trend in the housing market seems to be stabilizing.
Unsurprisingly, soaring interest rates are keeping the temperature significantly down for Canada’s housing markets this fall. Activity remains well below pre-pandemic levels in most markets and prices are softening further from peaks reached earlier this year. There were some interesting nuances emerging from the latest local real estate board reports though.
Let’s face it, many Canadians are feeling the heat of the current housing market situation. Following another interest rate hike, home ownership is down, rental costs are up and, for those in BC and Ontario — the two most expensive provinces to live — the tumultuous market isn’t going away anytime soon.
The average price of a single-family detached house is $1,248,000 in Vancouver. This is way more than the average price of similar houses in Canada, which is $531,000, or around that price range. Now the question is, which investment should you go for? Or, which investment is affordable for you? Paying rent for years eventually accumulates to the amount that a house costs right now. But do you have the money to pay the down payment and mortgage payments of your house?
Vancouver continues to see the highest rental prices in Canada, for both one and two-bedroom units. The average cost of a one-bedroom apartment in May 2022 was $2,377, which is a 1.8 per cent increase over last month and a whopping 19.1 per cent year-over-year increase.
Canada's housing market continued to cool down from its red-hot pandemic pace in May, with the average price of a Canadian home that sold during the month going for $711,000, a decline of more than $100,000 in the past three months.