Forecast includes predictions for interest rate cuts, home sales and prices, expectations for the spring market, and advice for buyers and sellers.
TORONTO, ON / ACCESSWIRE / February 12, 2024 / Wins Lai, an award-winning real estate broker in the Greater Toronto Area (GTA), has released her forecast of the 2024 housing market. A Top Producer for seven consecutive years, she provides analysis and advice on the direction of home sales, prices, inventory, and interest rates. Although inflation and affordability issues will continue to exert pressure on the housing market, Lai predicts the spring market will see a resurgence of buying and selling activity.
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The following is a summary of her forecast:
Latest numbers point to price growth
Based on the latest data from the Toronto Regional Real Estate Board (TRREB), GTA home prices were down 1% year-over-year in January to $1,026,703.
However, home sales were up 37.0% during the same period while new listings climbed only 6.1%.
According to the Canada Mortgage and Housing Corporation (CMHC), housing starts in Toronto plunged 35% in December 2023.
"Supply just isn't keeping up with demand," explains Lai. "As sales shoot up, inventory lags behind, and housing starts fall, the most likely outcome will be a rise in home prices over the coming months."
Entry-level homes will see more demand
Lai expects Toronto home prices to edge up as more buyers compete over low inventory.
As demand from first-time homebuyers and investors grows, entry-level properties (such as 1-bedroom condos under $600K and detached homes under $1.3M) will rise in popularity.
Low inventory could lead to an uptick in home prices, but broader economic influences must be taken into consideration.
For example, factors such as interest rates and new legislation could inject volatility into the market.
"Overall, I anticipate a brisk housing market in 2024," says Lai, "particularly in neighborhoods where multiple offers are becoming more common."
Rate cuts in late spring/early summer
Lai expects the Bank of Canada (BoC) to start cutting rates in late spring or early summer.
The markets have already witnessed a decline in bond yields, and as a result, a reduction in fixed-rate mortgages.
Lai says to keep a close eye on the BoC's April 10th Monetary Policy Report, which will provide further clarity on the central bank's trajectory.
"When interest rates do fall, prospective buyers should consider variable rate mortgages," advises Lai. "While fixed rates provide more stability, going variable seems highly logical given these assumptions."
Anticipated surge in spring housing market activity
Lai envisions a vibrant and dynamic spring housing market marked by a substantial surge in both buying and selling activity.
As interest rates decline, potential buyers who had been awaiting clarity on mortgage conditions are expected to re-enter the housing market.
The heightened competition is foreseen to result in an upswing in sales. However, given the prevailing limited inventory, there is a potential for home prices to ascend as a consequence
Lai emphasizes: "This heightened activity creates opportunities for both buyers and sellers, underscoring the need for astute navigation of market trends. In this dynamic landscape, success lies in a strategic understanding of the nuanced shifts and evolving dynamics that define the real estate market."
Advice for buyers and sellers
Lai urges sellers not to wait for a "better time" to list their property.
Instead, they should focus on pricing their property to accurately reflect its true market value.
By employing effective marketing strategies, sellers can also improve their chances of attracting more leads.
Buyers should start exploring the housing market before rates drop and competition heats up.
Lai points to government initiatives aimed at supporting new buyers, such as the First Home Savings Account (FHSA), coupled with favorable market conditions, as reasons not to delay.
"Sellers should seize the moment and list their properties confidently," Lai declares, "while buyers should take advantage of the current situation to pursue their homeownership goals. By staying informed and proactive, both buyers and sellers can successfully navigate the market."
Concluding remarks
Lai forecasts a very active housing market in 2024, an outlook based on interest rate cuts and new regulations.
In fact, all three levels of government are under tremendous pressure to make housing more affordable.
Toronto's Vacant Home Tax, Ontario's Trust In Real Estate Services Act (TRESA), and the federal government's extension of the Foreign Buyer Ban are proof of that.
"Seize the opportunities available right now," Lai advises. "Sure, you could wait for the BoC to start cutting rates, but then you'd face more competition-regardless of whether you're a buyer or seller."
About Wins Lai
Wins Lai is a real estate broker with Living Realty Inc. She has over 15 years of experience helping clients buy, sell and invest in property throughout the Greater Toronto Area. In 2023, she won her seventh consecutive Top Producer award, as well as the prestigious Company Wide Top Producer Individual award.
Contact Information
Wins Lai
Real Estate Broker
Living Realty Inc., Brokerage
Address: 7 Hayden Street Toronto, ON M4Y 2P2
Direct: 416.903.7032
Office: 416.975.9889
Email: [email protected]
Website: www.winslai.com
SOURCE: Living Realty Inc., Brokerage