Sales in 2023 did ease relative to last year’s peak, but with 27,416 sales, levels were still far higher than long-term trends and activity reported before the pandemic.

“Higher lending rates dampened housing demand this year, but thanks to strong
migration levels, housing demand remained relatively strong, especially for
affordable options in our market,” said CREB® Chief Economist Ann-Marie Lurie.
“At the same time, supply levels were low compared to the demand throughout
the year, resulting in stronger than expected price growth.”
Inventory levels were persistently below long-term trends for the city throughout
most of the year, averaging a 44 per cent decline over the 10-year average. We
also saw the months of supply remain well below two months throughout most of
the year across homes priced below $1,000,000.
The persistently tight conditions contributed to our city’s new record high price.
While the average annual benchmark price growth did slow from 12 per cent in
2022 to nearly 6 per cent growth in 2023, the price growth was still relatively
strong especially compared to some markets in the country.

Addressing the media following yesterday’s rate announcement, BoC Governor Tiff Macklem and Senior Deputy Governor Carolyn Rogers expressed that home prices have not responded to rate hikes in the anticipated or desired way.

As anticipated, the Bank of Canada (BoC) opted to hold its policy rate steady at 5% on Wednesday. In a statement, the bank cited “growing evidence that past interest rate increases are dampening economic activity,” including with respect to housing, where demand has softened considerably.

Even so, in addressing the media following yesterday’s rate announcement, BoC Governor Tiff Macklem and Senior Deputy Governor Carolyn Rogers expressed that home prices have not responded to rate hikes in the anticipated or desired way.

“Normally, house prices move pretty lockstep with interest rate increases. Most Canadians buy houses with credit, so they’re one of the first things that respond to monetary policy,” said Rogers.

And while prices have indeed come down over the course of the hike cycle — the not-seasonally-adjusted, national average price has slipped from $796,000 in March 2022 to $655,507 last month — many month-over-month declines have been nominal. There were also a number of months where prices managed to rally and offset declines.

“Relative to the degree of rate increases, we’re not seeing the decline in house prices that we would expect,” continued Rogers.

“There is a structural lack of supply in the Canadian housing market. So, really, until we address that supply issue, interest rates on their own are not going to help us get back to a housing affordability situation.”

BoC staff also spoke to mortgage realities confronting Canadians on Wednesday, saying that the bank is “paying really close attention to the mortgage renewal cycle.”

“Basically it’s monetary policy at work. As more households renew their mortgage at a higher rate, it puts downward pressure on spending. They have less money available to spend on other things, that dampens demand, that sort of gets the economy back in balance,” said Rogers.

“We are watching for the financial pressure that comes with that. We usually talk about that more in our Financial System Review — we’ve got an update to that coming in November and you’ll hear more from us on that at that point.”

Alongside a new program that will reward municipalities for reaching and exceeding their housing targets, Ford announced an extension of strong mayor powers to 21 additional municipalities.

As blowback for the Greenbelt land swap rages on, Premier Doug Ford announced a new $1.2B incentive program to get municipalities to build more homes.

Ford announced the new program, dubbed the Building Faster Fund, during his speech at the Association of Municipalities Conference in London on Monday, noting that it will “reward municipalities for reaching annual housing targets.”

“These targets will be ambitious, but realistic,” Ford said.

The Ontario Government has repeatedly asserted its intention to ensure the construction of 1.5 million new homes in the province by 2031, and has already doled out targets to municipalities. But with limited construction capacity, the ability to actually reach 1.5 million homes has been put into question.

On Monday, Ford said that, in the first year of the program, they are looking to achieve at least 110,000 new housing starts across the province. This is notably lower than the more than 150,000 housing starts experts estimate will be needed to reach the province’s goal.

Municipalities that reach 80% of their respective part of each year’s target will become eligible for funding “based on their share of the overall goal.”

“Think of it like this: if you get an ‘A,’ you become eligible for funding. If you do worse than an ‘A,’ you don’t,” Ford said.

Condo sales in Calgary were up a staggering 50% year over year in July, cementing the property type as the clear top product in the city.

While many large real estate markets in Canada have seen tempered activity this summer, Calgary just wrapped up a record July, according to statistics published by the Calgary Real Estate Board (CREB) this week.

In July, the City of Calgary recorded a grand total of 2,649 home sales, which is a decrease compared to the 3,144 sold in June, but a strong showing when factoring in seasonable trends. Last month showed an 18% increase compared to July 2022 and had the strongest July sales total on record.

By residential property type, single-detached homes still led the way, with 1,197 units sold, followed by condominiums at 772, rowhouses at 467, and semi-attached homes at 211.

The number of new listings added also decreased from 3,939 in June to 3,247 in July, but total inventory nonetheless increased, up from 3,461 in June to 3,488 in July.

“Continued migration to the province, along with our relative affordability, has supported the stronger demand for housing despite higher lending rates,” said CREB Chief Economist Ann-Marie Lurie. “At the same time, we continue to struggle with supply in the resale, new home, and rental markets resulting in further upward pressure on home prices.”

A swath of low-rise red-brick buildings in Regent Park will be demolished to make way for hundreds of new affordable housing units.

A swath of low-rise red-brick buildings in Toronto’s east end will soon be demolished to make way for hundreds of new affordable housing units and a public library.

The buildings, already Toronto Community Housing (TCHC) sites themselves, will be replaced with 633 rent-geared-to-income units and 637 net new affordable homes of as part of Phase 4 and 5 of the Regent Park revitalization.

Rezoning applications for the final phases of the years-long redevelopment project were approved by Toronto City Council last week. Bordered by Gerrard Street East, River Street, Oak Street, and Dreamers Way, the Phase 4 and 5 lands are the last 16 acres on the 69-acre Regent Park site to be redeveloped.

As part of the approval, 527 social housing units at 325 Gerrard Street East will be demolished this fall.

The aforementioned rent-geared-to-income replacement units will be comprised of 58 one-bedrooms, 223 two-bedrooms, 276 three-bedrooms, 50 four-bedrooms, and 26 five-bedrooms. The homes cannot be turned into condos or converted into non-rental housing for at least 40 years following occupation.

City Council has also authorized phased preliminary approval for the demolition of 189 social housing units at 274 Sackville, 355 Gerrard Street East, and 325 Gerrard Street East, and for the demolition of 338 units at 38 addresses on Sackville Street, Gerrard Street East, River Street, and Sumach Street.