TD expects steeper home price drop in early 2023 than initial forecast
A person walks by a row of houses in Toronto on Tuesday July 12, 2022. TD Economics has revised its housing forecast to account for even steeper price declines in early 2023 and then slower growth for the remainder of the year.THE CANADIAN PRESS/Cole Burston
The Canadian Press
Published Thursday, October 6, 2022 4:15PM EDT
TORONTO - TD Economics has revised its housing forecast to account for even steeper price declines in early 2023 and then slower growth for the remainder of the year.
The report from the bank's economist Rishi Sondhi foresees average national home price growth dropping by 11.2 per cent next year, but increasing by 6.1 per cent in 2024.
Sondhi says Canadian average home prices will recoup only a portion of their pandemic-era gains as personal incomes continue growing and bond yields begin declining in 2023.
His report adds annual average sales growth will fall 16 per cent next year, but rebound with a 19.1 per cent climb in 2024.
He says sales will bottom out at about 20 per cent below their pre-pandemic levels in the early part of 2023 and attributes the shift to higher borrowing costs that will further erode affordability.
Sondhi's report is based on data from the Canadian Real Estate Association, which said the country ended 2021 with an average national price of $669,364 and 719,047 sales.
This report by The Canadian Press was first published Oct. 6, 2022.