Real Estate

WHAT'S AHEAD: Real estate prices may bottom out when mortgage rates drop

“With fewer than 950 sales for the whole year, (2023) was the slowest year for real estate sales since 1997,” said Darcy Toombs of Toombs Team Real Estate Group in Newmarket

Since the start of 2023, single family homes in the GTA, in which Newmarket resides, have risen from $1.268 million to more than $1.3 million.

This year, the average price of a single family home in the GTA peaked in June at $1.402 million, but has since dropped each month to $1.347 million as of October.

Similarly, apartment prices in the GTA have risen in 2023 with the average cost being $698,300 in January and have risen to $713,500 as of October. But, apartments did dip as low as $682,000 in March and peaked at $728,400 in September. 

It was much of the same with townhouses in the GTA throughout the year with the average cost being $797,400 in

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Real Estate

What's next for commercial real estate?

Sooner or later, commercial real estate’s day of reckoning had to come. Following an era of “cheap money” that stretched all the way back to the 2008 housing crash and Great Financial Crisis, fueling an “everything bubble” that coincided with an age of “superstar cities” and their mega-valuable office buildings, the higher interest rates of 2023 were a shock. It’s largely this higher interest rate environment that’s caused the substantial distress experienced thus far, amounting to what research firm Capital Economics estimates at a $590 billion loss in commercial real estate property values this year. But just how bad will things get in the new year? 

Capital Economics, for its part, predicts another $480 billion wipeout in commercial real estate values next year, and another $120 billion loss in 2025, for a 24% peak-to-trough value decline. 

The failure of a mass return-to-office is the poster child for the woes of

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Real Estate

Do the '90s hold clues to what's next for Canada's real estate market?

There are “eerily similar circumstances” to today’s rapidly rising interest rate environment and what happened to the housing market in the 1990s when the Bank of Canada raised rates rapidly, a Re/Max executive says.

The Bank of Canada raised interest rates from 1.0 per cent in April 2022 to 5.0 per cent in July of this year. In comparison, between February 1994 and January 1995, the central bank raised rates from 7.25 per cent to 10.5 per cent.

Elton Ash, executive vice-president of Re/Max Canada, said the impact of the 1990s increases on the GTA’s housing market was immediate, with sales softening and average price declining from close to $209,000 to $198,000 in 1996. 

The same factors are at play today, with the market’s only saving grace the lack of inventory currently listed for sale, Ash said, commenting in the Re/Max Hot Pocket Communities Report, which was released in

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Forec

What's the best way to build a down payment for a condo fast?

Review your expenses and see where you can reduce spending to reach your goal sooner

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By Julie Cazzin with Janet Gray

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Real Estate

What’s next for the Bank of Canada, and why mortgage holders are still holding on: This week’s top real estate stories

Royal LePage Terrequity Realty

Here are The Globe and Mail’s top housing and real estate stories this week, with the lowest mortgage rates available in Canada today, commentary from our mortgage expert and one home worth a look.

The Bank of Canada holds off on interest-rate hikes, but the door remains open

The Bank of Canada held its benchmark interest rate at 4.5 per cent this week, pausing its year-long campaign to increase borrowing costs. The widely anticipated decision makes the Bank of Canada the first major central bank to halt monetary-policy tightening and puts it on a different trajectory than the U.S. Federal Reserve, whose officials have said they expect to increase interest rates several more times.

This sounds like good news for borrowers, but central bank officials say they need more evidence that the economy is cooling and inflation is slowing before ruling out further interest-rate hikes, reports

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