Looking back, 2020 was an exceptional year for the real estate market. So much so that it has caused many homeowners, buyers and potential sellers to watch the market and real estate trends more closely, even to this day.
Add that to the decreases in the number of sales from 2021 to 2022, increasing interest rates from the Bank of Canada, and new taxes and bans, and it's no surprise that many are questioning what 2023 will bring for the GTA market.
While every year brings unexpected changes and trends, the Joette Fielding Real Estate Group has looked at previous trends and data to understand what the first quarter of 2023 will look like for our clients. If you're interested in learning more, look at our 2023 forecast and our 2022 breakdown below.
Market Recap: Decrease in Sales from December 2021 to 2022
Due to seasonality and the market slowing down, we noticed a decrease in sales and average sale prices in many cities throughout the GTA in December 2022 compared to December 2021.
Number of Sales December 2022 vs 2021:
Oakville: There were 93 sales in 2022 vs 168 sales in 2021, which highlights a decrease of 45%
Burlington: There were 103 sales in 2022 vs 149 in 2021, which highlights a decrease of 31%
Hamilton: There were 284 sales in 2022 vs 532 sales in 2021, which highlights a decrease of 14%
Toronto: There were 1,162 sales in 2022 vs 2,395 sales in 2021, which highlights a decrease of 52%
Average Sale Price in December 2022 vs December 2021:
Oakville: The average sale price in 2022 was $1,449,722 compared to $1,546,037 in 2021. This highlights a decrease of 6.2%
Burlington: The average sale price in 2022 was $1,070,036 compared to $1,243,787 in 2021. This highlights a decrease of 14%
Hamilton: The average sale price in 2022 was $1,017,989 compared to $1,023,029 in 2021. This highlights a decrease of .5%
Toronto: The average sale price in 2022 was $750,601 compared to $861,695 in 2021. This highlights a decrease of 13%
New Market Bans and Taxes
The market has also changed due to some new bans and taxes that were recently introduced in Canada:
- In June of 2022, Canada banned FOREIGN HOME BUYERS, which recently came into effect on January 1st, 2023. This ban prevents Commercial Enterprises and individuals outside of Canada from buying residential properties. This ban will remain in place for the next two years and has been issued to prevent homes from becoming commodities, helping control rental prices and ensuring that most homes are occupied.
- Toronto has also implemented a new Vacant Home Tax of 1%. This new tax will be added to their residences' Current Value Assessment in addition to their yearly taxes. Starting February 2nd, 2023, every homeowner will be expected to complete a declaration even if they are living within their home. If the declaration is late, fines will be implemented. A 1% vacant tax will be added to their property tax bill if the home is vacant.
Q1 2023 Market Prediction
Over the past year, there have been quite a few changes to the market, with average sale prices decreasing and new bans and taxes being put into effect. However, as we approach the Spring Market, we anticipate an increase in inventory and more Buyers actively looking for new homes. This is expected to increase sales, along with the expected numbers of immigrants moving to Canada and some of the larger cities, including Toronto, Hamilton and Oakville.
As the year progresses, we will continue providing updates and trends to highlight how the 2023 real estate market unfolds.
Now, if you are a home buyer or seller and are questioning how to navigate the 2023 market, we can help. Feel free to download our home seller or buyer guides for advice, or contact us today for a free consultation.