While Newmarket’s real estate market is cooling for the first time in months, local realtors say that it is no sign of a crash, and it has been a booming time for the sector.
Housing prices in Newmarket, York Region and across the province have declined since a peak in February. Average house prices in Newmarket were approximately $1.44 million in February, compared to $1.19 million in May, according to the Toronto Regional Real Estate Board.
Newmarket-based real estate broker Darcy Toombs said the economy and increased interest rates are playing a factor, with buyers waiting longer to buy.
“It gives me some hope that there may be some affordability that could come back to the market if things start to balance out,” he said, adding there has been lots of speculation in the market that assumed real estate would always go up. “It’s kind of comforting to know there are other market factors that can come in and show us that things can change.”
The real estate trend is playing out similarly across the province. Average home prices across the region have gone from approximately $1.59 million in February to $1.37 million in May.
Sales in Newmarket are also down, from 150 in February to 119 in May.
But prices year over year are still up significantly. The average Newmarket home sale was $1.04 million in May 2021.
Jay Miller, another Newmarket realtor, said sellers are unsure of where they will buy a new home, which is impacting the market.
“We’re in the midst of flux, and we’re going to see how it plays out. Buyers, already over the next few months, they will be hoping for a significant downward spiral in price.”
The Bank of Canada hiked the interest rate in March and April, with experts predicting another rate increase to come.
Still, Miller said he does not see a large downward spiral in housing prices as likely. He also said higher interest rates could mean less buying power, which buyers should consider.
“Housing is reflective of uncertainty in the economy right now, with inflation high and the cost of living high and the stock market being volatile,” he said. “I think we will continue to see an adjustment in the market. I’m not convinced it will be a downward spiral or a severe adjustment.”
Toombs said similarly, though added it is likely to be more decline and eventually a dip below last year’s housing prices. He said it’s a buyer's market right now, with some outlying communities like Georgina taking longer to sell due to less willingness to commute with the gas prices.
“I don’t want people to think that the market’s crashing. I really don’t feel it is,” he said. “But there is certainly some hesitation from buyers.”
Miller said though he is running a real estate business, more reasonable prices would be healthy to see.
“We want young families to be able to buy a home,” he said. “That can only continue if we’re going to have reasonable house prices.”