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2023: is it a good time to buy a house?

#Buying a property

Last update : 2023-04-03 11:21:17

The last few years have been very challenging for buyers wanting to enter the property market. What will happen in 2023? Is it a good time to buy a property? Will buyers looking for their future home find something to their liking?

Of course, none of us have a crystal ball, and the answer to these questions will vary significantly from one individual to another. As the year has only just begun, the 2023 real estate market remains uncertain. Let's take a look at the factors that could potentially work both in favour of and against buyers in the coming months.

The Advantages of Buying a Property in 2023

Are you reluctant to purchase a home this year? Let's start by taking a look at the advantages you could enjoy by choosing to buy a property in 2023.

Lower property prices

Since the pandemic, housing prices have skyrocketed. Yet since July 2022, a reverse trend has been quietly taking shape within the real estate market. There has been a slight decline in property prices, particularly for single-family homes, and this trend may continue throughout 2023.

However, this must be put into perspective: despite a slight decrease, 2022 was still characterized by an average price increase of 13% on 2021. However, and as the APCIQ points out in its annual report, since the peak was reached in May 2022, 'on a consecutive monthly basis, the median house price has decreased'.

In 2023, prices of housing will be lower

One of the reasons for the observed decrease was the sharp rise in policy and interest rates, which led to a price correction. Increasing supply and stabilizing demand are also factors contributing to this adjustment in housing prices.

If you decide to go ahead with your purchase in 2023, you could benefit from this downward trend and end up paying a little less for your dream property. Note, however, that the actual extent of this price drop is far from certain.

Expert predictions on the subject are highly variable due to market uncertainty. In addition to this, the decrease in housing prices will differ across regions. Those most affected by this increase in prices are also likely to experience the most significant price corrections.

More houses for sale

The fact of the matter is that there are still far too few properties available to ensure a balanced market. Sellers thus retain favourable bargaining power.

That said, a return to more balanced conditions is gradually unfolding. In fact, the number of property listings has been on the rise since the second half of 2022, a phenomenon that has not been seen since 2016 according to Charles Brant, Director of the APCIQ's Market Analysis Department.

More properties on the market means more opportunities for buyers. And while there may be a more limited range of choice for some regions, this is still good news for those looking to purchase a property in the coming year.

More houses for sale in 2023

Less competition in the market

Due to inflation, rising costs of living, and numerous other factors, many households simply cannot afford to buy a property. As a result, there are fewer potential buyers out there, meaning you'll have less competition.

Experts predict a decrease in demand for 2023, but also an increase in overbidding. The market should become more rational and less impulsive. This will allow prospective buyers to take more time to explore different properties and make up their minds, while also being less likely to encounter multiple offers and overbidding situations.

The Disadvantages of Buying a Property in 2023

But while the year 2023 looks set to offer a few perks, it also presents buyers with some significant drawbacks that may well put many off.

Affordability continues to decline

Although a small drop in prices is on the horizon, this does not mean that affordability will improve. Rather, affordability has greatly deteriorated in recent years, and the dramatic rise in inflation and the cost of living certainly doesn't help households to increase their purchasing power.

While housing prices have fallen slightly, they remain about 20% higher than before the pandemic. Individuals looking to purchase a property this year will need to have a strict budget and sufficient financial resources to offset this decline in affordability.

It is important to remember that buying a house involves much more than the cost of the property itself. Several other costs must be taken into account, both before and after the purchase.

Mortgage rates are still high in 2023

High mortgage rates

In addition to this issue of affordability, those seeking to purchase a home in the coming months will also have to contend with high mortgage interest rates. The latter can greatly limit borrowing capacity and make it more difficult to qualify for the mortgage stress test.

Fortunately, many experts in the field agree that this upward trend in mortgage rates is coming to an end, with rates hopefully stabilizing in the near future. However, current and future homeowners should remain vigilant, as no decrease is expected anytime soon. Further increases may still occur if the country's economic situation requires it. However, these increases should not be as drastic as those that occurred in 2022.

Should you buy a house in 2023 or wait?

So, is 2023 a good year to purchase a property? As you can imagine, there is no right or wrong answer to this question. Whether or not you decide to go ahead with the purchase of a property this year depends mainly on your personal situation and your financial capabilities. It is up to you to weigh up the pros and cons and to make the appropriate choice.

In any case, it is worth remembering that a bad opportunity for one person may be a great opportunity for another. The important thing is to know your goals and your financial situation before you take the plunge, so you can assess whether this is a good time for you.

Do you feel ready to get onto the property ladder? Work with real estate experts, such as brokers, to facilitate your buying process.

Looking for a real estate agent to buy a home? can help you find a real estate broker. When you tell us about your project, we put you in touch with qualified resources for free. Simply fill out our form (it only takes a few minutes) and we will connect you with professionals.

Do you want to be put in touch with real estate professionals and get quotes? Contact us at 1 833 203-7768

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