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Canada’s housing market could look like in 2023



Canada's housing market 2023

After a series of interest rate hikes throughout 2022, the average home price in Canada has dropped by more than $180,000 since hitting its peak in February.

This “softening” of the market represents a shift to more accurate home valuation, said Moshe Lander, an economics professor at Concordia University in Montreal. This landscape of lower home prices is likely to continue into Canada’s housing market in 2023, he said.

“Housing prices have been disconnected from reality for some time now,” Lander told in a telephone interview. “The rapid increase in interest rates is probably going to generate a rather quick fall in housing prices [and] a sudden correction.”

The Bank of Canada has implemented seven interest rate hikes in 2022 alone, taking its key interest rate from 0.25 per cent in February to 4.25 per cent in December. By increasing interest rates, the Bank of Canada’s goal is to reduce inflation, Lander said. While Canada’s annual inflation rate dropped slightly to 6.8 per cent in November, the central bank’s goal is to bring that number down to its target of about two per cent.


Higher interest rates aim to reduce demand, discouraging Canadians from opting for larger loans such as mortgages, Lander said. This is already being reflected in some of the latest data from the Canadian Real Estate Association (CREA), said Doug Porter, chief economist at the Bank of Montreal (BMO) and could pass through in Canada’s housing market in 2023.

According to the CREA, actual monthly sales activity in November 2022 was nearly 39 per cent below that of November 2021. There were 49,357 residential sales reported over the MLS systems of major Canadian cities in November 2021. Exactly one year later, there were 30,135 sales. Both figures are not seasonally adjusted.

“There was no significant change in the overall trend [since October],” Porter told in a telephone interview. “Sales are clearly below the 10-year average.”

A continuation of this slowdown in sales activity is something Porter said he expects to see in 2023. Elevated interest rates will also continue to put downward pressure on prices next year, he said.

Average home prices for residential properties in Canada have already fallen 12 per cent from November 2021 to November 2022, according to non-seasonally-adjusted data from the CREA. Based on BMO’s forecast, average home prices are expected to drop another 10 per cent within the next six to 12 months, Porter said.

“That would really just compensate for the backup in interest rates,” he said. “The market just got overcooked late last year into early this year, and it was due for at least a minor correction.”

As interest rates rise, economists from the Royal Bank of Canada (RBC) are predicting the country will enter a recession in the first quarter of 2023. This slowdown in economic activity will likely also put downward pressure on Canada’s housing market in 2023, said Porter.

Despite a projected drop in costs, this may not necessarily translate into greater housing affordability, Porter said, as homeowners will likely continue spending money, just on higher interest rates instead of home prices.


The Bank of Canada has another announcement scheduled for Jan. 25. While the central bank suggested it may be ready to press pause on interest rate hikes, further increases have not been ruled out entirely.

According to Bank of Canada deputy governor Sharon Kozicki, the central bank’s decision on whether to continue raising its key interest rate will rest on the latest economic data.

“We are moving from how much to raise interest rates to whether to raise interest rates,” Kozicki said during a speech in Montreal on Dec. 8.

However, the bank also remains ready to “act forcefully” with rates if necessary, she said.

BMO is forecasting an increase of 25 basis points in January before the central bank holds its rate steady until 2024.

It’s unlikely the Bank of Canada will reduce its key interest rate any time soon, Porter said. As a result, Canadians can probably say goodbye to the low interest rate environment witnessed throughout 2021.

“It’s highly unlikely we’re going back to that,” he said. “Those days are probably behind us. The kind of interest rates that we have now are closer to what we’re probably going to deal with in the years ahead.”


While average home prices may have dropped across Canada since February, not all cities have been impacted by rising interest rates in the same way, Porter said.

Sales in the Greater Toronto Area have slowed down significantly in recent months, said Nero Naveendran, a real estate agent based in Toronto. Residential sales activity over MLS systems dropped 49.6 per cent between November 2021 and November 2022 in Greater Toronto, according to data from the CREA that is not seasonally adjusted.

The reason behind this drop likely stems from a sense of uncertainty residents are feeling about future interest rate hikes, including whether they will take place and if so, by how much, Naveendran said.

“Nobody wants to get into a market where they expect [prices] to continue to go down,” he told in a telephone interview. “They are waiting on the sidelines until they know for sure that interest rates won’t go up anymore.

“If we know that the interest rates are going to stay the same, then I think sales will pick up.”

Sheila O’Brien, a real estate agent based in the Greater Vancouver Area, said she is also seeing clients take a “wait and see” approach as well, particularly those looking to sell their homes, as they assess the ongoing impact of rising interest rates on prices.

The city of Montreal has also seen fewer sales within its residential market since July, said real estate agent Jaclyn Rabin. Rising interest rates are having a significant impact on reducing buyer demand, she said, with those looking to purchase a home now being more cautious with their spending.

“We’re seeing a much less competitive market compared to where we were in 2020 and 2021, when inventory and interest rates were at an all-time low,” she told in a telephone interview. “Brace yourself for a more stabilized market.”

During the first couple of years of the COVID-19 pandemic, Montreal and several other real estate markets were characterized by overbidding and home offers with few terms and conditions, which may have led buyers to assume more risk, Rabin said. With interest rates driving down demand, there has been less competition, she said. If interest rates remain elevated, this trend is likely to continue throughout 2023, said Rabin.

“There’s less bidding wars and people are able to go through all their conditions … I think that’s a good thing,” she said. “It’s a rebalancing of the market.”


If the amount of inventory in Montreal increases, particularly among single-family homes, this may place additional downward pressure on home prices in 2023, said Rabin.

“Are we going to see a five to 10 per cent decrease?” she said, referring to single-family homes. “We could … It’s entirely possible.”

So far, sellers appear to be standing firm on their prices, Rabin said. Without an urgency to move, many may be unlikely to bend on asking prices. As a result, some properties may take longer to sell, she said.

Sellers are also being stubborn with their prices in Toronto, Naveendran said. Additionally, homes that are nicely staged and well-marketed not only continue to sell, but are also receiving multiple offers. These are trends Naveendran expects to continue in 2023, he said.

“The homes that are not presented [or] cleaned well are sitting on the market for months, it’s not like last year where everything was selling,” he said. “Now, people are looking for a home to live in, not an investment.”

Although the average price of a home sold in Toronto has dropped between February and July of 2022, prices have remained fairly steady throughout the rest of 2022, Naveendran said. If interest rates continue to rise, it’s likely home prices will continue to plateau or drop slightly in 2023, he said.

Elevated interest rates have also resulted in relatively stable home prices in the city of Vancouver throughout the fall, said O’Brien. The average sale price of a residential property in Greater Vancouver went from $1,232,213 in September 2022 to $1,201,186 in November 2022, according to the CREA. Both numbers are not seasonally adjusted.

Home prices in Vancouver will likely continue to soften throughout the spring and stabilize by the middle of 2023, she said.

“It’s a return to somewhat of a normal market,” O’Brien said. “People will have an opportunity to make logical decisions with timelines that allow for due diligence and probably a bit of negotiation.”

According to a new report from Re/Max Canada, 60 per cent of the country’s housing markets will be considered balanced in 2023.


While larger real estate markets are expected to see prices continue to drop in 2023, the more significant corrections in average home prices will be among properties in smaller markets, said Robert Hogue, assistant chief economist for RBC.

This is particularly the case for markets located just outside of major urban centres, such as London and Kitchener in Ontario, or Fraser Valley in British Columbia. These regions saw some of the largest price increases in Canada during the pandemic, thanks to an influx of new residents moving from nearby hubs, Hogue said.

But with more Canadians physically returning to work, this trend has largely tapered off. As a result, these same markets are likely to see prices decline the most throughout the current correction period, Hogue said.

“Now that the frenzy is over, valuations are coming down to reflect the local realities,” Hogue told in a telephone interview.

According to Re/Max, average home prices in Kelowna, B.C., and Nanaimo, B.C., are likely to fall 10 per cent next year. Additionally, average prices in Barrie, Ont., are forecasted to drop 15 per cent.

Meanwhile, markets across the Prairie provinces have largely been resilient throughout the housing market correction so far, Hogue said. Although the region has seen some decline in average home prices and residential sales activity over the last year, these drops have been modest compared to other parts of Canada. This will likely continue to be the case in 2023, Hogue said.

Cities such as Calgary are even reporting an increase in average prices year-over-year. According to the CREA, the average sale price of a residential property in November 2022 was $504,518, not seasonally adjusted. This represents a 1.3 per cent increase compared to one year before.

Additionally, sales activity remains above pre-pandemic levels in Alberta and Saskatchewan, based on data from RBC, reflecting the region’s strong economy.

Housing markets in Atlantic Canada are not immune to the impact of rising interest rates either. However, they continue to be more affordable than those in larger urban areas, Hogue said. Because of this, demand will likely remain strong in the region thanks to interprovincial migration.

“If the correction [in Atlantic Canada] continues in Canada’s housing market in 2023, it will be more limited and end a little bit before other markets in Canada,” he said. “Those types of [migration] flows should provide some support for prices.”

Halifax in particular is beginning to stand out as a city where affordability is stretched, Hogue said. The market has seen tremendous demand throughout the pandemic, which has driven prices up significantly, he said.

According to Re/Max, Halifax will likely see average home prices increase by eight per cent in Canada’s housing market in 2023.

With files from CTV National News’ Jordan Gowling and The Canadian Press


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The Holocaust strikes our very being




To be a Jew is not something special,
being a human being is normal.
Dealing with prejudice, hatred, and oppressive action,
now that’s something special for the Jewish Nation.

Oppression, hatred, and genocide besides,
is not just a Jewish person’s situation.
Armenian, Cambodian and Jewish Peoples deal,
with a national eradication event.

People of the world unit,
genocide is an international delight.
Oppress your people, crush opposition too.
The elites of the world are making exceptions for you.

Don’t be weak, allowing excuses to be made,
but lift your hands in justice’s cruel wave.
Hatred knows no reasonability, it knows no mercy.
Hatred, oppression, and prejudice need no exception.


Long ago Jews were murdered by the millions,
Cambodians died at the hands of their neighbors.
Palestine still walks within the borders of other nations,
and peace is nowhere to be found, my friend.

If your arms are in righteous ways demand justice for all,
for the people who hate will not see our peaceful ways.
A gun, a bayonet, and a saber be brought,
for the right to justice begins today,
and ends with blood if the opposition has any say.

Gandhi spoke of peaceful ways,
while Martin Luther Jr surrendered his life. to the cause.
Young blacks die each and every day,
while the power of prejudice wins the day.

My first lifts in anger that is for sure,
while the average person just shrugs this day.
But the goose-stepping troops may one day march on,
and the ignorance that prevails will let them carry on.

Open our eyes to the wrongs before us,
clear our minds and accept what bothers us.
Injustice is a prevailing horrid thing,

Steven Kaszab
Bradford, Ontario

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Parliamentarians kick off return to House of Commons with debate on child care



Parliamentarians kick off return

The economy was top of mind for members of Parliament as they returned to the House of Commons Monday, with the Liberal government kicking off the new sitting with a debate on child care.

Families Minister Karina Gould tabled Bill C-35 last December, which seeks to enshrine the Liberals’ national daycare plan into law — and commit Ottawa to maintaining long-term funding.

The federal government has inked deals with provinces and territories in an effort to cut fees down to an average of $10 per day by 2026.

During a debate today, Gould said all parties should support the bill, and the national plan has begun saving families money.


But Conservative MP Michelle Ferreri said the plan is “subsidizing the wealthy” while failing to reduce wait times for child-care spaces and address labour shortages in the sector.

Ferreri told MPs that the Conservatives would be presenting “strong amendments” to the legislation.

The debate comes amid concerns about a possible recession this year, with both Prime Minister Justin Trudeau and Conservative Leader Pierre Poilievre saying their focus will be on the cost of living.

But Poilievre’s Tories may have little room to manoeuvre in the legislature.

NDP Leader Jagmeet Singh told reporters upon his return to the House of Commons that he does not believe there is any room to work with the Conservatives during the upcoming sitting.

Instead, the NDP says it plans to push the Liberals to fulfil the terms of the parties’ confidence-and-supply agreement, such as the planned expansion of federal dental care.

Under the deal signed last March, the NDP agreed to support the minority government on key House of Commons votes in exchange for the Liberals moving ahead on New Democrat policy priorities.

This report by The Canadian Press was first published Jan. 30, 2023.

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Singh meeting with Trudeau about private health care ahead of sit-down with premiers



Federal NDP Leader Jagmeet Singh said he will sit down with Prime Minister Justin Trudeau Monday afternoon to discuss private health care ahead of next week’s summit with premiers.

Trudeau is expected to meet with provincial and territorial leaders in Ottawa next Tuesday to discuss a new health-care funding deal.

“The deal will be a failure if it doesn’t include major commitments to hire more health-care workers,” Singh said Monday, adding that the funding should be kept within the public system.

The last time Trudeau and Singh met one-on-one, as outlined in the confidence-and-supply agreement between the Liberals and the NDP, was in December.


Singh said now is the time for the Liberal government to make clear that funding private health-care facilities will not improve the shortage of health-care workers Canada is facing.

While health care falls under provincial jurisdiction, Singh believes the federal government could be using the Canada Health Act more aggressively to challenge for-profit care.

Ontario Premier Doug Ford’s Progressive Conservative government announced earlier this month that it’s moving some procedures to publicly funded, private facilities to address a growing surgery wait-list, which worsened during the COVID-19 pandemic.

Provinces such as Alberta and Saskatchewan have already made similar moves.

“We think the federal government should be making it very clear that the solution to the current health-care crisis will not come from a privatization, for-profit delivery of care. It’ll only come by making sure we hire, recruit, retain and respect health-care,” Singh said.

“Health care is already dramatically understaffed, and for-profit facilities will poach doctors and nurses — cannibalizing hospitals, forcing people to wait longer in pain and racked with anxiety.”

The New Democrats say they’re also concerned that private facilities will upsell patients for brands and services not covered by the province, and tack on extra fees and services.

On Saturday, federal Health Minister Jean-Yves Duclos said his Liberal government will ensure people don’t use their credit cards for health-care services and health care will remain universally public.

Singh is also expected to request an emergency House of Commons debate on the privatization of health care Monday afternoon.

If the request is granted, the debate could go ahead as early as Monday evening.

Health care is a top priority for the leader as members of Parliament return to the House Monday following a holiday break.

Singh spent some of that time away holding roundtable discussions on health care in British Columbia to discuss emergency room overcrowding and worker shortages.

This report by The Canadian Press was first published Jan. 30, 2023.

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