Insider Advice
Trends in Real Estate: A 2021 review and what’s to come in 2022 The burning question on everyone’s mind is whether the real estate market in Toronto will stay as hot in 2022 as it was in 2021. Cameron Levitt, agent with The Richards Group, shares his market outlook
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very home purchase and sale is a story. The majority of people move for real-world reasons: they need more space or less, have to relocate for work or family, and need a lifestyle change. So when I look at forecasts, I start by looking back at the stories that have been and continue to drive us as the best predictor for how the next year will unfold. STORY 1:
A pandemic-driven frenzy Last year was unprecedented for many reasons. The pandemic and the response from the various levels of government were a tipping point that sent an already rising market into parabolic gains. First, the Bank of Canada set interest rates to historic lows. Then the psychological effect of the lockdown exponentially boosted the motivation for many people to find a larger house. But what’s talked about the least was a massive increase in personal wealth. Working from home directly created the largest rise in disposable income in decades. Suddenly, there was no need to buy gas to get to work, no parking to purchase, no buying clothes for the office. No vacations, no
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EastTO Magazine
movies or concerts, no eating/drinking out, no impulse shopping on the way home from work. On top of this forced savings, equity markets roared off the March 2020 crash. Along with that came a surge in retail stock trading, speculative option activity and gains in cryptocurrencies. Some of this newly found wealth was invested as larger down payments for real estate. After reviewing the events last year, it should be no surprise prices exploded upwards of 35% in Q1 in some areas of the GTA. Buyers pushed forward at a frenetic level of activity that surpassed the hottest years in memory. Areas like Durham, York and Halton, which traditionally offered value compared to central Toronto, saw incredible gains as buyers flushed with cash and fueled by record-low rates desperately sought to escape smaller living quarters in the city. Houses in central areas of Toronto stayed hot and also experienced massive gains across the board, as did recreation properties in cottage country. As the year progressed, prices remained well elevated over the previous year, but we did witness a bit more balance come back to the market.
