rising interest rates<\/a> we\u2019ll see as the Bank of Canada winds down its \u201cemergency-era monetary policy,\u201d which saw the overnight rate plummet to 0.25 per cent in 2020, where it has stayed since. As a result, growing rates could see more affordable condo homes soaring in demand compared to pricier housing types.<\/p>\nThis would be similar to 2018, the last time rates were hiked. During this period, sales were down, but prices for GTA condo townhomes and apartments shot up the most, increasing between nine per cent and 10 per cent that year. Detached homes, by comparison, rose in price by four per cent during the same period.<\/p>\n
In 2022, Zoocasa predicts that condos will lead price growth, a factor that could be supported by the returning desire for city living as pandemic restrictions ease.<\/p>\n
\u201cTaking cues from 2018, when interest rates rose last, we can predict that the most affordable price points in the market, like condos and townhomes, will lead growth in 2022 as a result of higher borrowing costs,\u201d said Lauren Haw, CEO of Zoocasa.<\/p>\n
Big year for GTA condos on the horizon<\/h3>\n
Already a couple of months into 2022, condos are moving quickly on the Toronto-area market.<\/p>\n
According to Zoocasa sales representative Ross Aitken, the average price of a GTA condo increased by $36,000 in the first month of 2022. After two years in and out of lockdown, buyers are optimistic and excited to return to an urban lifestyle, he noted.<\/p>\n
\u201cUsually, when we see detached price gains slow, condos will grow. Heading into the new year, major bodies like the Toronto Regional Real Estate Board are expecting price appreciation to moderate from the record pace we saw in 2021, and rising interest rates will only make the most affordable homes on the market more attractive,\u201d said Aitken.<\/p>\n
\u201cI\u2019m anticipating that we\u2019re going to see a big year for condos in the Region,\u201d he added.<\/p>\n
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<\/a>Photo:\u00a0alpegor<\/a> \/ Adobe Stock<\/em><\/p>\n