After experiencing years of unprecedented irregularity, Canadians may witness the real estate market inching closer to normalcy in 2024, according to new insights from the Royal LePage Market Survey Forecast.
Projections indicate that the aggregate home price in Canada is expected to increase by 5.5% year over year, reaching $843,684 in the fourth quarter of 2024. The median prices for single-family detached properties and condominiums are expected to rise by 6.0% and 5.0%, reaching $879,164 and $616,140, respectively.
Phil Soper, President and CEO of Royal LePage, notes that 2024 is viewed as a crucial tipping point for the national economy, as Canadians recognize the end of the ultra-low interest rate era.
Royal LePage's forecast relies on the assumption that the Bank of Canada has concluded its interest rate hike campaign, with the key lending rate remaining steady at five percent through the first half of 2024. Modest rate cuts are expected to commence in late summer or fall of the following year. Concurrently, several major financial institutions have already initiated discounts on fixed-rate mortgages.
Soper emphasizes that Canadians are shifting their focus from the idea of significantly lower interest rates to accept a mortgage rate of four to five percent as the new normal. This shift in perspective is expected to unleash pent-up demand, particularly among first-time buyers who have accumulated savings during the extended housing market downturn. As confidence is restored, a resurgence in first-time buyer demand may lead to an increase in listings from families eager to upgrade their homes.
If you are planning to move in the new year, or have any questions about the current state of the real estate market, please feel free to contact me!