As we head into the final stretch of 2022, let’s look at Toronto’s October Real Estate numbers & the hot rental market.

Before I get into the details, I did a quick search online for real estate and holly molly you would think we’re in a deep depression. Absolutely the real estate market is down from the peak earlier in 2022 but late 2020 & 2021 were abnormal and unsustainable years. We need to stop comparing data to those 2 years. Looking at the overall trend the past 7-8 years is a better indicator. Ok, that was my soapbox speech for the day.

Let’s summarise Toronto’s real estate market and the rental market. First, for the real estate market, looks like we’ll end up at the lowest sales in the past since 2010.

We’ll probably end up with around 75,000 sales. 2021 was at 121,000 sales which was off the charts.  I look at it from a glass half full perspective. For 2023, with the Bank of Canada increasing its benchmark rate by 3.5%, I believe the majority of the increases have been done. Yes, there will be more increases moving forward but I don’t believe the economy can take another 3.5% increase in rates. Based on that, I believe real estate sales and activity will pick up the second half of 2023.

For the rental market, let me give you some figures: average one bedroom condo in central Toronto rented for about $2550 in Q3, two bedroom condo in central Toronto rented for over $3400 and bachelors rented for $2100. Real estate investors, I have a question for you: You can buy at a lower price, you can buy without competing in multiple offers, your rental incomes are through the roof and expected to further increase as less buyers qualify to buy…what are you waiting for?

The x-factor which will put upward pressure on house prices and rental markets is immigration. The federal government announced they will increase the number of newcomers to half a million by 2025 due to labour shortage. 

In 2021 we had 405,000 newcomers.  This population growth will put pressure on housing, schools, healthcare, infrastructure such as roads and public transportation. We are not building enough homes to accommodate the population growth which will result in higher housing & rental pricing.

Until next time, happy home hunting…..