Will house price in Canada go down in 2024?

Are you wondering if the housing market will crash in 2024? Well, I have some good news and some bad news for you. The good news is that there is no clear evidence that a major downturn is imminent. The bad news is that the prices are still very high and unaffordable for many people.

 

According to the latest forecast from the Canadian Real Estate Association (CREA), the national average price for a home will increase by 9.1% in 2021, reaching $677,775. That’s a huge jump from the previous year, when the pandemic caused a temporary slowdown in the market. However, CREA expects the price growth to moderate in 2022, with a 0.6% increase to $681,500. And in 2023, the average price will drop slightly by 0.5% to $678,200.

 

So, what about 2024? Well, that’s where things get tricky. There are many factors that can affect the housing market, such as interest rates, immigration, supply and demand, consumer confidence, and government policies. Some of these factors are hard to predict, especially in the long term. However, based on the current trends and projections, here are some possible scenarios for 2024:

 

– Scenario 1: The optimistic scenario. In this scenario, the economy recovers strongly from the pandemic, creating more jobs and income for Canadians. The Bank of Canada keeps the interest rates low to stimulate growth and inflation. Immigration resumes at pre-pandemic levels, bringing more buyers and renters to the market. The supply of new homes increases to meet the demand, easing the pressure on prices. The government introduces more measures to support homeownership and affordability, such as tax credits, grants, and subsidies. In this scenario, the average price for a home in 2024 could be around $690,000, a 1.7% increase from 2023.

 

– Scenario 2: The realistic scenario. In this scenario, the economy grows moderately after the pandemic, but still faces some challenges and uncertainties. The Bank of Canada raises the interest rates gradually to curb inflation and debt levels. Immigration remains below pre-pandemic levels, reducing the demand for housing. The supply of new homes improves slightly, but not enough to balance the market. The government maintains some of the existing measures to support homeownership and affordability, but does not introduce any major changes. In this scenario, the average price for a home in 2024 could be around $670,000, a 1.2% decrease from 2023.

 

– Scenario 3: The pessimistic scenario. In this scenario, the economy struggles to recover from the pandemic, resulting in high unemployment and low income for Canadians. The Bank of Canada hikes the interest rates sharply to control inflation and debt levels. Immigration drops significantly, leaving many homes vacant and unsold. The supply of new homes declines due to low construction activity and high costs. The government withdraws some of the existing measures to support homeownership and affordability, or introduces new ones that have negative impacts on the market. In this scenario, the average price for a home in 2024 could be around $650,000, a 4.2% decrease from 2023.

 

Of course, these scenarios are not predictions or guarantees. They are just possible outcomes based on some assumptions and estimates. The actual outcome may be different depending on how things unfold in the next few years. However, they can give you some idea of what to expect and how to plan accordingly.

 

So, what do you think? Do you agree or disagree with these scenarios? Do you have your own opinion or prediction? Let me know in the comments below!