From Spring Festival to Spring Market
My holiday in Taiwan is coming to an end and I am feeling energetic and refreshed. I’ve been keeping tabs on the news and statistics regarding real estate in Kitchener-Waterloo, and it seems like we are ahead of other areas in terms of demand for housing. I can’t wait to see what will happen in the Spring market!
Days on market data reveals Waterloo Region demand still high
According to recent data, several Ontario markets are seeing high demand for homes. In December, Waterloo Region had the fastest home sales with properties spending an average of 25 days on the market. Other cities with relatively quick home sales include Aurora (26 days), Whitby (28 days), Markham (29 days), Hamilton (34 days), and Brampton (36 days). In contrast, demand for homes in Caledon and Orangeville was slower, with properties spending an average of 60 days on the market. Other cities with slower home sales include Vaughan and Milton (47 days), Burlington (46 days), Oakville and Halton Hills (43 days), and St. Catharines (43 days). Overall, there has been a slowdown in Ontario home sales, but the pace varies depending on location.
Kitchener rents continue steady rise
The average listed rent for all property types in Canada rose 12.2% year over year in December to $2,005, an increase of $217 over the same month last year. The average rate of annual rent increase for 2022 was 10.9% over 2021. The double-digit growth in rents can be attributed to a recovery from declines experienced during the pandemic, record high population growth, a large pullback in home buying and low vacancy rates. In Kitchener, the average monthly rent in December for a one-bedroom was $1,968 and $2,446 for a two-bedroom, with year over year increases of 32% and 28.4% respectively.
Inflation prediction for 2023 and 2024
The Canada Inflation Rate is projected to trend around 2.5% in 2023 and return to around 2% in 2024. This is the level at which policymakers and bankers generally aim for. The reason interest rates were raised quickly last year was to counter inflation.
Report predicts lowest home sales in a generation
TD Economics has predicted in its latest report that Canada’s housing market will experience its weakest sales year since 2001 due to affordability challenges. The report also suggests that the decline in home sales will end in early 2023 and that average home prices will bottom out in the opening months of the year, around 20% lower than the market peak. However, the bank expects average home prices and sales to tick upwards in 2024 due to lower inflation, interest rates, and higher immigration after a weak performance for the national economy this year.
My second home in Taiwan
By the time you are reading this, I will have returned from my holiday in Taiwan. For those who may not know, I have a deep connection to the island. I lived there for most of the 1990s, bought my first house there, got married there, and my children were born there. A few years ago, I purchased a small apartment in Kaohsiung and I typically spend part of the winter there. Taiwan is truly my second home.