Where are Housing Prices Headed in 2023? Experts Predict Stabilization and Increased Supply


Housing predictions

EEBA a north America wide high performance builders group predicts moderation in housing inflation due to lower demand. They seeing the tables turning where trades will relinquish the “high ground” of simply making demands with higher prices. Some sense of normalcy may come into the market in 2023 with the regular negotiation of contracts being closer to a two-way street, putting downward pressure on trade prices. 

These comments and predictions are handy to give us a picture of what’s happening across the board nationally but looking closer to our market is more helpful in trying to plan our own decisions. A mentor once gave me a tip to never to use the macro to make deduction about the micro, the specifics in a particular market. That has turned out to be good advice when I look back!

With the recent passage of Bill 23 there has been a major “push back” by the provincial government to restrict the powers of the Cities and Municipalities. Probably the most significant in our local market is the ability to have up to 3 dwelling units on a residential lot. This “As of right” zoning will be largely un assailable by the local authorities with specific limits on the additional conditions that can be put on each property that could otherwise prevent these additional dwelling units via a “back door approach” (see the chart below extracted from an article by Chris Barnett et al of the Toronto law firm Osler).

Parts of the bill are still to be passed into law, but the general tenor and intention of the Bill is to accelerate approvals, reduce red tape, push back on overweening municipalities, and provide more affordable housing. As the newly minted bill is still being digested by the many stakeholders the result is yet to be seen but one can imagine the consternation that could result from converting from one to three units in a quiet upscale residential neighbourhood. This plan for intensification is coupled with other legislation which sees less cars per household and more public transit. 

The lingering parts of the bill awaiting passage into law reflect its comprehensive goals aimed at reshaping the real estate landscape. The overarching purpose of the bill is clear: to streamline the approval process, slash bureaucratic red tape, challenge the authority of municipalities, and foster the development of more affordable housing options. While the ink on this newly minted legislation is still drying, stakeholders across the spectrum are diligently digesting its contents.

The potential impact of the bill, especially in upscale residential neighborhoods, where the conversion of single-family homes to three units may become more prevalent, is sparking considerable discussion. The anticipation of such intensification measures has raised concerns among residents, who may envision the transformation of their quiet, upscale neighborhood. The reaction to this shift will likely vary, reflecting the delicate balance between the need for increased housing density and the desire to preserve the character of established communities.

This legislative push for intensification aligns with broader strategies promoting sustainable urban living. The concurrent focus on reducing the number of cars per household and enhancing reliance on public transit indicates a commitment to creating more connected and environmentally conscious communities. As this multifaceted legislation takes root, its effects on both the housing market and the overall urban landscape will undoubtedly become clearer.

The bill’s emphasis on affordability and efficient development reflects a broader trend in urban planning, acknowledging the need for innovative solutions to accommodate growing populations while maintaining a high quality of life. However, the potential consternation resulting from these changes underscores the importance of a thoughtful and inclusive approach to urban development, involving collaboration between policymakers, builders, and communities to strike the right balance.

In conclusion, the evolving legislative landscape, especially with the impending implementation of Bill 23, demands a nuanced understanding of its potential implications. Stakeholders must remain vigilant as the industry navigates these changes, ensuring that the quest for more affordable housing and sustainable urban living harmonizes with the aspirations and concerns of local communities. The outcome of this legislative shift is yet to unfold fully, but its impact will undoubtedly shape the future of residential development and community dynamics in the region.