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The detached housing market in the first half of 2023 has witnessed a mix of challenges and opportunities. A recent report indicates a significant drop in detached home values during the first quarter (Q1), leading to heightened home buying activity in the second quarter (Q2). The report covered data from 82 districts within the Toronto Regional Real Estate Board (TRREB), the Real Estate Board of Greater Vancouver (REBGV), and the Fraser Valley Real Estate Board (FVREB). Nearly 93% of detached homes across these markets experienced a decline in values compared to 2022, with a downturn in buying activity reported in 95% of the surveyed markets.

While the majority of the housing market faced challenges, a few neighborhoods stood out with increased home sales. Some neighborhoods in the Greater Toronto Area, such as Bayview Village, Don Valley Village, and Henry Farm, witnessed a notable climb in the number of homes sold. The report attributes this increase in activity to demand for affordably priced detached homes below $2 million. However, the surge in buying activity was limited by low inventory levels.

Inventory shortages continued to impede buying activity in various areas, with a shortage of properties reported in many markets. Affordability emerged as a driving factor behind buying decisions, leading to increased activity in areas with lower prices and value-added properties. The report also highlighted the impact of the land transfer tax on home buying decisions, particularly among younger generations.

Looking forward, the report acknowledges parallels to historical circumstances, particularly in terms of potential interest rate hikes. With Canada's inflation rate rising and expectations of further rate hikes, there's uncertainty about the near-term prospects of the housing market. However, experts remain confident that stability will return to the housing market, and improved affordability could reignite momentum once again.

Read the full article on: REAL ESTATE MAGAZINE