Toronto Housing Market Ends Year with a Whimper
The country’s largest housing market quickly turned in the spring of last
year when the Bank of Canada launched its campaign to reduce inflation by
aggressively raising interest rates.
The typical five-year mortgage now has an interest rate that tops 5 per
cent. That is more that double the going rate a year earlier. The higher
borrowing costs have priced many prospective buyers out of the market and
reduced competition for properties.
Selling prices have found some support in recent months. One reason could
be the lack of inventory as homeowners hang onto their properties and postpone
potential sales.
Lack of supply has also impacted the rental market. As renting has become
more popular in this higher interest rate environment, tighter rental market
conditions have translated into double-digit average rent increases.