February 2023 Oakville real estate update

Have we hit bottom and are now seeing a rise in residential real estate prices?

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There is no denying that February 2022 was the top of the market, with sellers regularly receiving multiple offers. 

If you look at year-over-year real estate prices and unit sales, it seems bleak; however, for the February 2023 real estate update, you can't help but wonder if we've hit bottom and real estate prices are rising. 

Oakville's residential real estate market update for February 2023 shows that numbers are off from February 2022, but prices rose by $183,494 for a typical home from January. There is more inventory, so buyers have greater choice, but sellers are holding firm. For the right homes priced competitively, buyers are willing to enter into bidding wars.

"New listings continued to drop year-over-year in the GTA. Recently released Ipsos polling suggests buying intentions have picked up for 2023. This increased demand will run up against a constrained supply of listings and lead to increased competition between buyers," stated TREB Chief Market Analyst Jason Mercer in the TREB February 2023 Market Watch.

Other positives: Bank of Canada's Tiff Macklem isn't expected to increase the Bank of Canada rates any further, and the Consumer Price Index fell to 5.9% or 0.4% in over a month.

The deciding factor for buyers is whether they can qualify for a mortgage. Canada's stress test for buyers with a deposit less than 35% of the appraised property value is 8.7%.

GTA Update

Across the GTA, owners sold 4,783 (or 4,245 fewer properties) in February 2023 than in  2022, a 47% decrease. Over the same period, GTA property values decreased by 17.8% to $1,095,617, down $238,445.

However, the price and number of units sold increased from January 2023 have increased. 1,683 more properties sold, and the average price increased 5.48% from January to February. 

Oakville Update

During the last month, sellers in Oakville listed 355 properties and sold 177 properties. Available inventory expanded to 2.4 months.  

The average residential property sold for $1,564,949, up $183,494 from January; a sale took 33 days, down 12 days from the previous month. 

Buyers, on average, were paying 98% of the listed price, up 3% from January. 

Year-over-year home prices

A typical residential property in Oakville is now going for $1,372,000, which has dropped by 20.15% since February 2022 but up $45,000 from January 2023. An average detached home price is $1,774,200, down 20.07% but up $72,000 from the previous month. 

An attached home is $1,160,900, down 19.79% from a year ago but up $53,000 over the past month. A townhouse will run you 21.75% less at $853,300, again up by $13,300. A condominium apartment costs $655,400 - down 13.58% from last year and down from last month by $16,300.

February 2023 Oakville residential real estate statistics

DOM - total days a property is for sale; % LP to SP - the percentage difference between the list price and the sold price.

The best 5-year fixed-rate insured mortgage is 4.38%, which increased by 0.10% from the January real estate update. However, a 3-year variable rate is available at 5.65%.

It is still considerably higher than the fixed rate but might be what people who believe the Bank of Canada rate will drop by at least 1.25% or even return 2% over the next few years.

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    February real estate prices continue to surge as purchasers look to lock in mortgage rates. The average detached home in Oakville sold for $2.2 million. Will the interest rate hike and Putin's war dampen prices for March?

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    If a home was purchased in January 2022, the buyer could be facing a loss from 5-20% if they attempted to resell the property in January 2023. The market will likely stabilize now that the Bank of Canada has signalled no further rate hikes.