house price

New report indicates house prices set to ‘moderate’ in the coming months

House prices, sales levels, and housing starts are expected to moderate from recent highs, but remain elevated in 2022, according to the latest housing market outlook report from the Canada Mortgage and Housing Corporation (CMHC).

The housing market outlook forecast range, based on information as of March 9, shows that the average home price (MLS® average price) could reach $782,400 in 2022; $831,100 in 2023; and $867,800 in 2024.

In Toronto, the average home price (MLS® average price) could reach $1,349,000 in 2022; $1,417,000 in 2023, and $1,509,000 in 2024. These numbers are only second highest to Vancouver, which could see prices reach $1,459,000 in 2022; $1,504,000 in 2023, $1,548,000 in 2024.

Bob Dugan, Chief Economist for CMHC, noted in a statement that improving levels of employment and immigration are expected to be “key factors”, as the impact of pandemic restrictions continues to recede.

By late 2023 or early 2024, housing sales and price growth are expected to fall more in line with historical averages, with sales and housing starts activity expected to remain above five- and 10-year averages. Higher price levels will continue (led by markets with low listings, including Vancouver, Toronto, and Montreal) since price growth will remain positive, placing pressure on the affordability of entering homeownership.

Homeownership affordability is expected to decline with rising mortgage rates and with the growth in prices is expected to outpace income growth.

Recent rental market trends are also expected to continue over the forecast period, meaning rental affordability is set to decline from increasing rental demands and low stocks of rental housing.

Article exclusive to STREETS OF TORONTO