Cooling detached home prices lured buyers in these markets despite rising rates

Cooling home prices in most parts of the Greater Toronto and Vancouver areas saw some buyers flock to those cities' detached housing markets, Re/Max said in a new report.

Many neighbourhoods in the Greater Toronto and Vancouver areas saw a jump in detached home sales in the second quarter of 2022 as buyers locked in lower rates and took advantage of discounts, according to a new report from Re/Max.

The real estate brokerage compared home prices and sales activity across dozens of communities in the two metropolises between the first and second quarters of the year.

The report provides a glimpse into how segments of the Toronto and Vancouver housing markets reacted as the Bank of Canada rapidly hiked interest rates, starting in March of this year.

“Those fast and furious incremental increases placed downward pressure on housing sales and prices, improving affordability on one hand, but eroding it on the other,” said Chris Alexander, president of Re/Max Canada, in a statement.

Re/Max found that home values dropped 10 to 15 per cent in the second quarter of the year compared with the first in parts of the Greater Toronto area, with Durham, Peel, Dufferin, York and Halton all experiencing double-digit drops.

Only 15 Toronto neighbourhoods saw an uptick in price quarter-to-quarter, five of which were in the city’s core.

Alexander pointed to the core’s strong demand and finite supply, along with higher average incomes for residents, as keeping the area “resilient” through the downturn.

In Vancouver, 75 per cent of neighbourhoods saw home price declines in Q2, most of which dropped around 10 per cent in value, Re/Max said.