New Homes on the Way and Housing Sales Forecast Downgraded

This week’s top real estate stories.

By  Jared Lindzon | 2 minute read

Every Friday, Wahi brings you the most important real estate stories from the past week.

New Homes Are On Their Way, Eventually  

Relief is on its way for Canada’s housing market, but don’t hold your breath. According to CMHC housing starts jumped 41% last month, representing the highest increase in a decade. The vast majority of the 280,000 units now under construction are multi-units, and nearly half were in Vancouver and Toronto. Other parts of Ontario, however, saw dips in construction, with half of the cities that posted monthly declines based in the province. Experts warn that while the progress is significant, it won’t be enough to make up for declines earlier this year and may slow with rising interest rates.   

Millionaires Not Immune to Rising Interest Rates

Even Canada’s wealthiest are feeling the effects of pricier mortgages as they navigate a luxury real estate market in decline. Only five homes worth $10 million or more changed hands in Toronto during the first half of the year, according to Sotheby’s International Realty Canada, a 28% decline from last year. The GTA, meanwhile saw a 56% decline at the high end of the market. Sales of homes over $4m are also down 35% across the GTA and 32% in the city proper but luxury sales are expected to bounce back in the second half of the year.    

Toronto Becoming Unaffordable for Renters   

Rising interest rates are rippling through the rental market, and the reactions have been dramatic. According to new data from Urbanation GTA condo rents broke a new record, surpassing $2,800 in Q2 — 12.6% above last year. According to one report, Torontonians need to earn $40 an hour to afford living in the city. Last weekend 300 tenants went on strike in protest, and experts worry Toronto will lose a generation that can’t afford to stay in their hometown.   

Sales Forecasts Downgraded For 2023 and into 2024  

Last week’s rate hike took the wind out from the sales of an already battered ship. CREA says the unexpected rate hike in June and July sequel will slow sales, which came out of the gate strong in early 2023 but quickly lost momentum when rate hikes were un-paused. Now the organization is lowering its sales and price forecasts for not just the remainder of this year, but 2024 as well. CREA predicts a 0.2% decline in prices and a 6.8% drop in sales this year, before a 3% increase in prices and 11.2% increase in sales for 2024.

Why You May Need a Mortgage For Your Parking Space   

Ever feel like you couldn’t even buy a parking space today for what your parents paid for their home? Well, we have some pretty depressing news for you: a parking spot in downtown Toronto just hit the market, and it’s listed for $179,900 — that’s more than the cost of an average house in Toronto in the ‘80s. It also wouldn’t be the first parking space in the city to nab six figures. The pricey underground spot at Bay and Wellesley does come with a locker, but buyers will be subject to a $300 property tax, and $94.90 monthly maintenance fees.