RE/MAX on next year's outlook
Canadian home price growth will likely remain at restrained levels in 2024, with Toronto expected to see a significant decline in prices, according to RE/MAX.
The average residential price across the country will see a muted 0.5% annual increase in 2024. This is despite 61% of regions anticipating growth in unit sales next year, RE/MAX said.
Canadians’ sentiments towards the housing market are expected to remain positive, with the momentum continuing to defy challenges such as supply issues and elevated interest rates.
“The majority of Canadians (73%) are confident that home ownership is the best investment, a sentiment that remains unchanged year over year,” RE/MAX said in its 2024 Housing Market Outlook Report.
Among Canadian markets, 41% are expected to regain balance next year, while 28% will favour sellers, 21% will favour buyers, and 4% will see mixed conditions.
“It’s been a challenging year for Canadian homebuyers and sellers, who have been feeling the effects of a severe housing shortage and the high cost of living, but much like Canada’s housing market, Canadians have stayed resilient,” said Christopher Alexander, president of RE/MAX Canada.
“Historically, real estate has given owners excellent returns and strong financial security – and that hasn’t changed.”
The Canadian federal government plans to allocate approximately $20.8 billion over six years to incentivize the development of housing supply and address affordability challenges.
— Canadian Mortgage Professional Magazine (@CMPmagazine) November 22, 2023
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Interest rates will have an outsized influence on market activity
Still, more than half (54%) of Canadians expressed worries about the impact of further interest rate increases, saying that these mounting costs will affect their ability to participate in the market. The anxiety was particularly widespread among millennials, with 73% agreeing with the statement.
Other factors that could influence home-buying trends in 2024 are climate change (41%), alternative home ownership (21%), and inter-provincial/city migration in search of better affordability (17%).
Seven in 10 Canadians (72%) said that governments at all levels should also consider the diversity of the new housing being developed.
