The number of sales in the Greater Toronto Area is 75,140 residences sold in 2022. Everyone wonders where the market and the prices will head in 2023. But what does history tell us?
In the past 14 years, we had similar sales numbers only twice. In 2018 when sales were around 78,000 and in 2008 when sales were around 74,500. You may remember both as two challenging years. 2008 marked the beginning of a global financial crisis in the US. While 2018 was when the foreigner purchaser tax came to force as well as mortgage stress tests.
Fun fact: In 2018 many realized that non-Canadian citizens or non-permanent residents are a very small percentage of the market. Making it difficult for them to buy did not have a significant impact. Will it be the same for the 2023 foreign buyer ban?
But what happened in the years that followed 2008 and 2018? In both cases in 2009 and in 2019 the number of sales, as well as the sold prices, increased. Buyers at the time felt the time was right and saw an opportunity. What is even more interesting is how in both cases this started in February.
Will 2023 feel like Deja Vu? The word on the market is that there are tens of buyers that are waiting. Waiting to see when the Bank of Canada will stop raising rates so they can make their move. The next rate announcement will take place on January 25, 2023.
What if a large number of buyers decide to make a move at the same time this year? In a market where so far supply is lower than in previous years? No one has a crystal ball. One thing is certain. In 2023 some people will choose to buy and some people will decide to sell.
The real question is what are you going to do and how will it impact your life?