Weekend Reading – Housing market predictions

Weekend Reading – Housing market predictions

Hey folks!

Welcome to a new Weekend Reading edition about housing market predictions.

Before we get into this week’s theme, here are some of my latest posts:

Are you passive or active? Some say the passive vs. active investing debate is “dead”.

Well, I’m not one of those people who say investing has to be this or that. Check out my thoughts in this article here. 

I wrote about the Top Canadian Dividend ETFs you might consider owning for income and growth. To help fight some inflation, you probably need both. 

Weekend Reading – Housing market predictions

What a difference a year makes…

This time last year, in yet another wave of the pandemic no less, housing prices were skyrocketing across the country. But things have changed.

Canada’s housing market saw a slowdown in sales during the month of April 2022 as rising interest rates have curbed homebuyers’ thirsty real estate appetite.

For April 2022, the average home price in Canada’s housing market was $746,146, up 7% from last year. While Canada’s average home price has risen by over $50,000 in the span of one year, home prices have fallen compared to the previous month. March 2022’s average home price of $796,068 means that the average home price in Canada has fallen by over 6% in just one month.

In fact, after breaking through the $1 million mark for the first time in February 2022, the average Ontario home price slumped back down to $985,354 in April 2022. Ya, a 6% month-over-month drop from March 2022. Mind you, the average home price in the GTA was still well over a million at $1,254,436 in April 2022.

In a recent Zolo article, there are a host of housing market predictions for the rest of 2022. For my province, the results below seem very consistent to what I’m reading elsewhere – click the image below for the article and your provincial sentiment:

Housing market predictions - Zolo


“In the past three years, the real estate market has seen record-high prices, a consistent seller’s market and plenty of bidding wars. For that reason, many first-time buyers feel locked out of the market. So when it comes to 2022 housing market predictions in Canada, we surveyed to determine what they think will happen and how it’s impacting their decision to buy — or not.”

If I had to make a guess for later this year, where the housing market is going, I would say the following:

  • Expect real estate prices (that have been inflated too high for too long) to come down this year, maybe down another 10% from where they are now. 
  • Expect the cost of owning a home to go up, with inflation running hotter and with borrowing costs going up as well. My friend Robert McLister, a respected mortgage analyst and expert, was recently quoted that for the first time since 2010, nationally-available uninsured 5-year fixed rates are all above 4%. McLister also recently referenced some TD research that estimates 5-year fixed rates have increased 140 basis points year to date, which equals about a 12% decline in affordability for the average homebuyer.
  • Expect people to complain about the combination of higher inflation and higher interest rates since many people feel they didn’t see it coming.

Of course, the latter point is hardly a prediction since we’re seeing that now.

Anyone paying any moderate attention to our economic climate over the last 10 years would recognize what I call an “upside down world” has been happening: a screaming bull market has occured, during a once-in-a-century pandemic no less, supported by uber-low inflation, supported by non-existent borrowing costs, supporting by government stimulus and money-printing, triggering lots of encouragement to take on debt, be and stay leveraged, and enjoy lots of money most people don’t make. 

I think that’s all coming home to roost in the next few years.

What’s your take on the housing market now? Where do you think it might go? 

More Weekend Reading…

How much real estate should you even have in your portfolio?

Why the housing market is more important than the stock market – at least right now.

Inflation is running hotter and likely to increase even more in 2022. Expect it. So, how can you take advantage of inflation in your portfolio, with higher interest rates to combat it? Here are three great ideas.

Diversification is always helpful in your portfolio since some sectors (i.e., real estate) don’t always correlate with others. Dale Roberts from Cut the Crap Investing updated his ultimate asset allocation ETF portfolio page. 

While I do like one-ticket ETFs for many investors that don’t have the desire to own individual stocks directly, I must say, I do enjoy owning individual stocks directly 🙂

Here are some big bank raises I received this week for being a long-term shareholder in these companies:

  • CIBC (CM) raise by 3%.
  • Bank on Montreal (BMO) raise by 4.5%.
  • Bank of Nova Scotia (BNS) raise by 3%.
  • Royal Bank (RY) raise by 7%.
  • National Bank (NA) raise by 6%.

What? No raise by TD…? Nope, but they raised their dividend back in December 2021 by a healthy amount. All good people. Dividends are just part of total investing returns. 

Here are some interesting money lessons from athletes and celebrities.

I had a good laugh at this one:

“Taylor says, “If I’m making $2 to $3 million a year, I don’t care about spending $1,000 at a restaurant. I don’t care about buying 2,000 pairs of shoes because I’m making that much money. But the real challenge is sustainability. It’s something that plagues not only athletes and entertainers but the common man and woman as well.”

No, the common man and woman does not spend $2,000 on shoes…some better writing and context needed here!

When it comes to money management, I think you should save like a pessimist and invest like an optimist, meaning be aggressive with equities. Have a read of The Psychology of Money for many other money management tips to live by.

Our Life Financial shared her way to build a defensive but also very smart income-oriented retirement portfolio.

From Melissa: “Start early, reinvest those dividends, grow your portfolio and your income will follow. When retirement comes, you can use the dividend income to offset your living expenses without much worry. That’s being defensive.” Amen. 

This portfolio manager isn’t buying bonds and hasn’t done so for decades.

Here are the top Canadian REITs with thanks to Stocktrades.ca.

Congrats to Tawcan on his very impressive dividend income update for April 2022.

From Bob: “Payments from these 19 companies added to $4,283.52. This marked the second time this year we crossed the $4,000 dividend income per month milestone! I suppose the next key milestone for us is hitting $4,500 per month.”

Dividend Strategy believes most disciplined dividend growth investors shouldn’t worry about inflation. 

Tiny Thought for the Week:

The greatest threat to results are boredom and impatience.

In our world of instant gratifcation, we glorify results. We don’t give nearly enough praise to the process and the folks that follow them to realize their goals. 

The difference between good and great results is often found in consistently doing the boring things you know you should do exactly when you feel like doing them the least.

(Share this Tiny Thought on Twitter)

Read more at Farnam Street, outstanding content.

I’ll be back next week to hopefully answer a reader question that might apply to you as well!

Have a great weekend!


My name is Mark Seed - the founder, editor and owner of My Own Advisor. As my own DIY financial advisor, I'm looking to start semi-retirement soon, sooner than most. Find out how, what I did, and what you can learn to tailor your own financial independence path. Join the newsletter read by thousands each day, always FREE.

23 Responses to "Weekend Reading – Housing market predictions"

  1. Deane Hennigar (RBull) · Edit

    Good comments on this upside down world and the likelihood of this hitting people now and in the near future. House prices will return closer to earth. Property taxes here rise every year – at least for me – 6.4% for me in ’22.

    With many concerns about inflation, toppy market valuations, recession, higher rates etc its good to be seeing dividend raises and potential of more to come to grow household income and likely offer some stability in tougher times.

    Yes to your tiny thought. I think its often about learning to really like and enjoy the process no matter what you’re talking about. That makes it sustainable.

    1. Well put on enjoying the process Deane. I’m learning to do that more….

      Taxes in Ottawa are up about 4%. Likely more in 2023.

      If investors are not into dividend paying stocks in the coming decades they will be regretting it. I know it’s just one part of total return but it’s HUGE for retirees = the ability to live off dividend income. Some folks are not paying attention. They will be sorry I think…

      I hope you’re doing well. I walked 10+ km today around the city with my wife. More time outside is the perfect life hack 🙂

      1. Deane Hennigar (RBull) · Edit

        Great. Being successful and sticking with something that takes a lot of time to master is all about the process (and not the goal) – learning, enjoying, practising. Saving, investing fits into that. Exercise does too.

        Agree with you on dividends. I am confident it will give us some comfort when much tougher times come.

        Doing well. Getting improvements with a badly stubbed baby toe that shut me down for nearly 3 weeks so far, but did my strength training this am, and walked today with my wife for about 8km on Nova Scotia’s longest sandy beach at the mouth of our harbour. Incredible sunny, very warm 25 degrees in a spot notoriously cool and sometimes foggy! Was exactly like Caribbean except water temp is around 7C but lots of surfers out with wet suits!!!

        1. Great to hear. We walked well over 10 km+ yesterday and I feel very good this am.

          “…exactly like Caribbean except water temp is around 7C but lots of surfers out with wet suits!!!”

          No joke, that’s cold! 🙂

    2. I would like to see house price down although I am a home owner. The housing market makes life so difficult for next generation. I saw my colleagues buying single family house to start a family when I just began to work, then townhouses, then condos, then just renting. Totally understandable that they don’t want kid or only one kid. Raising kid in a rented small apartment with sky high child care fee is hard.

      Overall I am pretty concerned with Canadian economy along with global economy. Well, nothing in my control. The only thing I can control is keep working, saving and investing. At times like this, a bigger hay certainly gives me more comfort. Still, once working becomes stressful I think we will just retire.

  2. Love those raises from the Bank Mark ! hopefully more will follow:) One of the things that I enjoy now from holding individual companies is that you can follow how those companies are doing in order to grow and generate more value for shareholders vs holding etfs when you can only watch the price fluctuations and the irregular payouts.
    Loved the ” Tiny thought of the week” it’s spot on.

  3. I love what you wrote about boredom and impatience (The greatest threat to results are boredom and impatience. In our world of instant gratifcation, we glorify results. We don’t give nearly enough praise to the process and the folks that follow them to realize their goals.). I’ve been patiently watching my DC pension go up and sometimes slightly down over time. A couple months ago, I called their office concerned that my ‘high risk’ pension was ‘too’ risky since I’m expecting to need the $ in 10 years or so. They said to hold on – there are natural bumps in the market etc. Now, my pension is down by 17% (around $100K)!!! On the one hand, I regret being too patient, but, on the other hand, I think that the market will recover (be patient). It’s still hard to look at the numbers, however!

    1. Absolutely: We don’t give nearly enough praise to the process and the folks that follow them to realize their goals.

      Marie, there will always be bumps but I recall from previous emails you’re doing VERY well. Are you concerned these days?

        1. Yes, it is but with your DB pension that’s a great safety net. I think quite a few folks that have a healthy DC pension or LIRA or other, might be down quite a bit in recent months but have to stick with the process!

  4. Just got my property tax notification, and our condo value is down $10,000 from last year. It’s market value is also much lower than I paid for it. Do I care? Nope. Lower market value means less property taxes, and I’m not looking to sell.

    1. Lower value doesn’t mean lower property taxes. Only if the relative value of your condo to other housing has dropped significantly more.
      My property tax notice (which come in January) shows the average percentage increase for the city and the percentage increase for my house. If my house is higher than the average I know I will get an increase in taxes come tax payable time (which is now).
      My house assessed value is double what it was 10 years ago, but the property taxes I pay are about the same.

      1. MPAC in Ontario determines taxes, not current prices.

        Yes, real estate prices have nothing to do with my plans to buy or sell or other. Meh. 🙂

        Our home/condo is a place to live. We’re almost out of debt and part-time work should cover a few “extras” in life. Dividend income will over the rest. That’s the plan anyhow!

        Our condo might be north of $1.1 M now or closer to $900k. It really doesn’t matter since I have to live somewhere.

        Are you planning to move, sell or stay Barbara?

        1. Mark, as of this week we have been in our current home for 20 years. Amazing, the longest I have lived anywhere. We moved 5 times in 6 years (across Canada twice, overseas and back, and once local) and I vowed I was never moving again. With 3 kids and a dog it was a huge undertaking every time.
          Fortunately, I still love my home and don’t ever want to move. I like having a lovely garden and lots of beautiful outdoor areas for walks and hikes right outside my door. Apple and peach orchards just down the street, and downtown 11 minutes away. It is very sad the ridiculous values in my city, as it just means my two kids who are here are priced out. My oldest was able to afford a nice house with a pool and huge fenced yard in Boston, way better prices there. And he has a mortgage with a fixed rate of just under 3 percent, with that rate in effect for 30 years.

          1. Great stuff.
            Yes, moving is a PITA!
            Orchards just down the street sound very nice and peaceful. I think your kids might get a shot in other 1-2 years with housing. Interest rates should help cool things off a bit. Money isn’t supposed to be pretty much free nor should debt. We’ll see though if Bank of Canada sticks to their plan. They may not…

    2. Cannew, what’s $10K? That’s a rounding error.

      As you know, focus on what income your portfolio provides to you and your generational wealth. 🙂

      Stay well my friend,


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