Your Definitive Guide to the Provincial Housing Market in Ontario for 2023
Market Report Summary for June 2023
- Ontario’s average home sale price decreased 19.3% year-over-year to $867,900 for June 2023. While in comparison, nationally, the average home sale price was down 15.8% from a year ago to $715,400.
- The average price of an average single-family home in Ontario decreased by 20.6% year-over-year to $945,000 for June 2023. While in comparison, nationally, the average detached home sale price was down 17.5% from a year ago to $781,300.
- Ontario’s average town/rowhouse price decreased by 17.5% year-over-year to $686,100 for June 2023. While in comparison, nationally, the average town/rowhouse sale price was down 13.1% from a year ago to $660,700.
- The average condo price in Ontario decreased by 11.1% year-over-year to $625,700 for June 2023. While in comparison, nationally, the average condo sale price was down 7.9% from a year ago to $528,500.
- The average rent for a 1-bedroom apartment in Ontario increased by 16.9% year-over-year to $2,180 for June 2023. While in comparison, nationally, the average rent was up 10.1% from a year ago to $1,729.
Ontario Housing Market Outlook June 2023
As of June 2023, data from the Ontario Real Estate Association (OREA) and Canadian Real Estate Association (CREA) indicates that the average price of resale residential homes sold across the province in June 2023 was $865,279, a substantial decrease of 20.4% compared to a year ago.
Residential sales activity reported through the real estate boards in Ontario numbered 10,891 units in June 2023. This was a sharp decrease of 43.5% compared to a year ago.
The number of new listings on real estate boards in Ontario saw a sharp decrease of 29.5% compared to a year ago. There were 19,143 new residential listings in June 2023. This was the lowest number of new listings added in over 35 years. New listings were 18.8% below the five-year average and 18% below the 10-year average for any June. Active residential listings numbered 27,252 units on the market at the end of last month, up sharply by 97.2% compared to a year ago.
Additionally, Ontario’s sales-to-new listings ratio (SNLR) stands at 56.9% as of June 2023, showing power is still in the buyer’s hands as the market edges on the balanced territory.
(For context, a market is considered a buyer’s market when the SNLR is 70% or more since a higher proportion of sales than listings indicates lower demand relative to supply.)
Who’s Buying Ontario Real Estate?
Until recently, the primary demographics driving demand in Ontario’s residential property market were those looking to upsize their homes, foreign investors looking to purchase an investment property in one of Canada’s university towns, professionals who recently immigrated to Canada in the past 5 years, and out-of-province migrants advancing their careers in Toronto while maintaining a commutable distance in Ontario.
With the passing of the omnibus Bill C-32 legislation, including the foreign buyers’ ban and anti-flipping tax, the Ontario homebuyers’ demographic may be shifting away from foreign investment. However, it remains to be seen whether efforts to limit foreign buyers in Ontario will have an impact; according to Statistics Canada, foreign investors make up less than 5% of homeowners in Ontario’s largest cities’ total homeownership.
According to a report by Teranet, investors and multi-property owners accounted for over 25% of Ontario’s homebuyers in 2021, particularly in Ontario, where the numbers were even higher. A report by StatsCan, which tracks the concentration of residential properties owned by investors across Canada, said that investors in Toronto own 29,530 out of the city’s 34,180 condominium apartments, a rate of 86.4% – more than twice the provincial average of 41.9%. Greater Toronto is provincially and nationally the largest real estate market division.
Upsizing by buyers has driven Ontario’s demand for single-detached homes, which showed the highest year-on-year price increase of all property types from $697,400 in February 2020, which is still more than 35% lower than today’s price at $945,000. Upsizing buyers continued to explode some of Ontario’s most active real estate markets, like those in Toronto, Ottawa, Mississauga, Hamilton-Burlington, Brampton, London, Windsor and Oakville-Milton. You’ll notice that most of Ontario’s 7-digit home valuations are centred in and around the Greater Toronto Region.
Immigration & Out-of-province Migration
While the pandemic saw thousands of homebuyers leaving urban areas searching for more space and affordable housing, new immigrants are making Ontario homes a continued surge. Although many Ontarians continue to leave Ontario due to housing affordability limitations, many continue to move here. According to this report by Re/Max, the federal government expects to bring an additional 2 million new immigrants to Canada – many of whom will still choose to settle in Toronto, Vancouver and Montreal.
Getting a mortgage in Ontario as a first-time buyer can be challenging for many. Ontario has some of the highest property tax rates for a large city, with over 1% of property value in most smaller communities and larger urban cities such as Kingston, Ottawa and London.
While programs like the First Time Home Buyer Incentive are in place to help people afford homes in Ontario, this has yet to do much to offset affordability as the stress test makes it harder to qualify. At the same time, the Bank of Canada keeps rates elevated – adding a barrier to qualifying for a home without a combined household income over $150,000.
Given the slowdown over the last 12 months in home prices, Ontario remains a difficult market to purchase a first home without outside financial assistance.
Ontario Historical Prices Changes June 2023
This section breaks down historical prices and overall improvements in the province’s average home prices by type.
|Current||1 Month Ago||1 Year Ago||3 Years Ago||5 Years Ago|
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Ontario Metrics By Region June 2023
This section breaks down housing market prices regionally across the province.
Central Ontario Housing Market Prices
Greater Toronto, Mississauga, Oakville-Milton
Eastern Ontario Housing Market Prices
Kingston and Area, Ottawa, Rideau-St. Lawrence
Northeastern Ontario Housing Market Prices
Bancroft & District, Barrie & District, Kawartha Lakes, Lakelands, Northumberland Hills, Peterborough and the Kawarthas, Quinte & District
Northern Ontario Housing Market Prices
North Bay, Saul Ste. Marie, Sudbury
Southern Ontario Housing Market Prices
Brantford, Cambridge, Guelph & District, Hamilton-Burlington, Kitchener-Waterloo, Niagara, Simcoe
Western Ontario Housing Market Prices
Chatham-Kent, Grey Bruce Owen Sound, Huron Perth, London & St. Thomas, Tillsonburg District, Windsor-Essex, Woodstock-Ingersoll
All data was gathered from the Ontario Real Estate Association (OREA) and Canadian Real Estate Association (CREA). Missing data indicates that the region does not monitor all property types. If the composite home price is the same as all other property types, then the average pricing belongs to the composite benchmark price. If the townhouse/rowhouse is priced the same as a condo, then the average pricing belongs to the townhouse/rowhouse in that region. Some regions lack detailed data to provide metrics.
Share of Housing Market by Region June 2023
This section breaks down the share of housing market metrics regionally across Ontario.
Ontario Monthly Housing Summary
|Region||Residential Sales||YoY % Change||Average Price||YoY% Change|
Ontario Year-to-Date Housing Summary
|Region||Residential Sales||YoY % Change||Average Price||YoY% Change|
Provincial Rental Breakdown June 2023
Average rental cost comparisons between Ontario and other provinces and municipalities around Ontario.
Each $100K in mortgage balance costs an average of $550 per month for principal and interest on the current insured fixed rate and $620 per month on the current insured variable rate. Rates used for calculation are those offered on insured purchases with less than a 20% downpayment over 25 years of amortization. Each 0.25% change in mortgage rates impacts the monthly payment by $14 to $16 on a 25-year amortization.
Average rental cost comparisons between cities in Ontario and other provinces.
Ontario and Canadian Cities Rental Prices Comparisons
The table below shows that Ontario has the most cities topping the chart for the highest rents nationally.
|Province||Total||Bachelor||1Bdr Average||2Bdr Average||3Bdr Average||Total YoY Change|
|North York ON||$2,497||$1,657||$2,174||$2,706||$3,376||24.10%|
Ontario Rental Prices Compared to Canada and the Provinces
As the data below shows, Ontario is one of the least affordable provinces for rentals after BC among the provinces, with a population of over 1 million inhabitants.
Average Rents by Housing Type
|Province||Total||Bachelor||1Bdr Average||2Bdr Average||3Bdr Average|
Rental Growth by Housing Type
|Province||Total YoY Change||Bachelor YoY Change||1Bdr YoY Change||2Bdr YoY Change||3Bdr YoY Change|
Frequently Asked Questions
Is the Ontario housing market going to crash?
Ontario home prices are currently sagging due to surging mortgage rates. Ontario prices remain some of the highest in the country, and with the current Bank of Canada rate hikes, mortgages have been harder to qualify for due to the stress test. Ontario prices will recover quicker than in other areas once mortgage rates decline back to manageable levels for homebuyers to purchase or homeowners to refinance their homes.
Will Ontario’s housing prices increase in 2023?
Although currently declining, many experts believe that a turnaround is imminent. Buyers are waiting on the sidelines for the opportune time to make a move.
How do I get approved for a mortgage in Ontario?
To get approved for a mortgage in Ontario, look at Ontario mortgage rates and see how much you can afford. This will give you an idea of what it will cost to buy a home in Ontario at today’s prices and rates. You can check out what you need to get pre-approved for a mortgage or start by getting a quote.
Ontario’s property market is set to remain strong as increases are expected for the remainder of 2023. The average home price in Ontario has dropped significantly since last year. However, this comes after months of record consecutive price rises during the pandemic and one of the most intense periods of price appreciation the province has ever seen.
While the property market appears to be shedding value in Ontario, it’s important to remember that this is relative to a long period of superheating in the area.
If you are looking for a home in 2023, expect an imminent turnaround in the housing market over the next few months. Contact our knowledgeable and commission-free mortgage experts at nesto to help guide you through the home-buying process.
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