Home prices to drop one per cent by Q4 2023: Royal LePage outlook

Home sales continue to fall, buyers poised to re-enter as selling prices flat line: TRREB analyst Jason Mercer, chief market analyst at Toronto Regional Real Estate Board, joins BNN Bloomberg to discuss the latest TRREB report on declining housing activity in the GTA. Listings are down 49 per cent year-over-year and Mercer says that markets are being hampered by higher rates and that it's time to get shovels in the ground to see more homes online in 2023.

TORONTO — Royal LePage is forecasting the aggregate price of a home in Canada will drop by one per cent to $765,171 by the fourth quarter of 2023.

The real estate company says it expects prices to flatten in the second quarter and then modestly increase in the second half of the year, ending 2023 on an upward trajectory.

Its calculations show the median price of a single-family detached property will fall by two per cent to $781,256 and condominiums will slide one per cent to $568,933 by the end of next year.

Royal LePage attributes its predictions to declining affordability, which has been exacerbated by rising interest rates, and continued housing supply shortages, which are acting like a floor on home price declines.

It foresees homes in Vancouver remaining the most expensive in 2023, dipping only one per cent next year to more than $1.2 million. Regina will be the most affordable of the places it studied as aggregate home prices will fall 1.5 per cent to $361,495 by the end of 2023.

The Canadian Real Estate Association previously forecast home prices will increase 0.2 per cent in 2023 to $721.814 in 2023.