2022: The Year in Review - December Real Estate Market Report

After a strong start in the first three months of the year, the Bank of Canada started to raise interest rates and prices started to decline. At the end of the year we're counting 7 rate hikes in a row, which brings the key interest rate to 4.25% - the highest since 2008.

Prices back to early 2021 level

The average home price in Aurora dropped from $1,633,259 in February to $1,191,994 in August and has since balanced out. The December average was $1,239,509, which is 13% lower than one year ago. The current price level is comparable to prices that we've seen in the first half of 2021.

In Newmarket the peak was also reached in February when the average price climbed to $1,444,858 and then came down to $1,051,080 in August - and that's pretty much where prices still were in December (-19% year-over-year).

2022 Sales 38% down

"Following a very strong start to the year, home sales trended lower in the spring and summer of 2022, as aggressive Bank of Canada interest rate hikes further hampered housing affordability", says Paul Baron, President of the Toronto Regional Real Estate Board (TRREB).

There were 75,140 sales reported through TRREB's MLS System in 2022 - down 38.2% compared to the 2021 record of 121,639. New listings (152,873) were down 8.2% compared to 2021 (166,600). The average price for all types of homes combined throughout Toronto and the GTA was $1,051,216 and down 9.2% compared to December 2021.

Following the trend of the past 4 months it seems that prices have levelled off. It'll be interesting to follow what the Bank of Canada will do with regards to the interest rates (first announcement is scheduled for January 25th) and how active the market will be in the first couple months of this year. I'll make sure to keep you posted!