February 2022 Market Analysis📈🏠

February continued to show a large increase in dollar sales (up 27.7%) while sales volume was down (16.8%).  The demand for new listings vs the low supply is the biggest reason for this dollar sales increase.  TRREB believes that we will see “a more moderate pace of price growth in the second half of 2022”.  One of the biggest reasons for this will be the interest rate increases that are scheduled throughout the year that could go up 1.25%.  The first increase of 25 basis points was on March 2.

A 27% increase in dollar sales in not sustainable and the TRREB predicted last month a 12.5% increase in overall home sales (condos and houses) for 2022.  Even 12% is prohibitive for many first time buyers but 27% is unhealthy.  Once again, I feel that increasing the supply of new homes (including condos) will lessen demand and give a more balance home buying market.  By balanced I fee 6-8%.  Doug Ford’s announcement on January 19 to decrease unnecessary delays and pledged a $45million fund to “cut red tape and sped up the process of managing and approving applications for building new homes.”