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  • Writer's pictureThe Mackenzie Group

Niagara Real Estate Forecast 2024: What to Expect in the Coming Year

The Niagara real estate market has been a focal point of interest for both buyers and sellers, especially in the aftermath of the pandemic. With mortgage rates expected to decline over the next 12 to 24 months, many are keen to understand how the market will evolve in 2024. This article delves into the current trends, economic influences, and future projections for Niagara's real estate landscape.

Key Takeaways

  • The Niagara real estate market is anticipated to transition into a buyer's market in 2024, with average home prices projected to increase by 3.5%.

  • Sales activity in the Niagara region is expected to rise by 4.5%, driven by declining mortgage rates and stable market conditions.

  • Economic factors, both local and national, will play a significant role in shaping the Niagara real estate market, with potential sluggishness in the local economy influencing market dynamics.

Current Trends in the Niagara Real Estate Market

Market Performance in Late 2023

Niagara's real estate market continued to trend in a positive direction as its benchmark price again ticked upward, with gains in sales and new listings. Niagara’s luxury and recreational housing markets continue to thrive as buyers increasingly seek to purchase larger, more spaced-out properties outside of city centres. This shift is largely driven by the desire for more space and the ongoing impact of remote work.

Factors Influencing Market Dynamics

Several factors are influencing the current market dynamics in Niagara. These include:

  • Economic Recovery: The post-pandemic economic recovery has bolstered consumer confidence, leading to increased real estate activity.

  • Mortgage Rates: With mortgage rates expected to come down over the next 12 to 24 months, more buyers are entering the market.

  • Urban Exodus: There is a noticeable trend of buyers moving away from city centres to more spacious properties in Niagara.

Comparative Analysis with Previous Years

When compared to previous years, the Niagara real estate market has shown remarkable resilience and growth. Year-to-date, Niagara home prices have increased 11%, with further growth anticipated. This is a significant improvement from the 70% decline in sales experienced in April 2020. The market is currently balanced, with 3.5 months of supply, but is expected to shift in favour of sellers as prices continue to rise.

In summary, the Niagara real estate market is on an upward trajectory, driven by a combination of economic recovery, favourable mortgage rates, and changing buyer preferences. Stakeholders should keep an eye on these trends to make informed decisions in the coming year.

Economic Influences on Niagara Real Estate in 2024

Impact of Mortgage Rate Changes

The anticipated decrease in mortgage rates over the next 12 to 24 months is expected to have a significant impact on the Niagara real estate market. Lower mortgage rates typically lead to increased buyer activity, as borrowing becomes more affordable. This could potentially drive up demand and, consequently, home prices. However, the extent of this impact will depend on how quickly and substantially rates decrease.

Local Economic Conditions

The Niagara economy is projected to be more sluggish in 2024, according to the Conference Board of Canada (CBoC). This economic slowdown could influence the real estate market by tempering buyer enthusiasm and reducing the overall number of transactions. Key local factors to watch include employment rates, local business growth, and consumer confidence.

National Economic Trends and Their Effects

Nationally, the Canadian real estate market is experiencing a cooling period following the rapid growth seen during the pandemic. While this trend is expected to continue, it does not necessarily indicate a long-term downturn. For Niagara, this national cooling could mean a more balanced market, with neither buyers nor sellers having a distinct advantage. It is crucial to monitor national economic indicators such as GDP growth, inflation rates, and federal housing policies, as these will have ripple effects on the Niagara market.

In conclusion, while the Niagara real estate market faces several economic influences in 2024, understanding these factors can help stakeholders make informed decisions. Keeping an eye on mortgage rates, local economic conditions, and national trends will be essential for navigating the year ahead.

Future Projections for Niagara Real Estate

Expected Price Movements

The Niagara real estate market is anticipated to experience moderate price increases in 2024. According to the 2024 RE/MAX Housing Market Outlook report, the average sales price for a home in Niagara is projected to climb 3.5% to approximately $725,000. This growth is driven by a combination of factors, including a continued demand for larger, more spaced-out properties outside of city centres. Buyers are increasingly seeking to purchase homes in less densely populated areas, contributing to the upward pressure on prices.

Sales Activity Forecast

Sales activity in the Niagara real estate market is expected to rise by 4.5% in 2024. This increase is supported by the anticipated decline in mortgage rates over the next 12 to 24 months, making home purchases more affordable for a broader range of buyers. Additionally, the market is predicted to shift towards a buyer’s market, providing more opportunities for negotiations and favorable terms for purchasers.

Emerging Market Segments

Several emerging market segments are expected to gain traction in Niagara's real estate landscape. The luxury and recreational housing markets continue to thrive, with buyers showing a strong preference for properties that offer more space and amenities. Furthermore, there is a growing interest in sustainable and energy-efficient homes, reflecting broader environmental trends and consumer preferences. These segments are likely to see increased activity and investment in the coming year.

The Niagara real estate market is poised for significant growth in the coming years. Whether you're looking to buy or sell, staying informed about future projections is crucial. Visit our website to explore detailed market insights and get ahead in your real estate journey.

Conclusion

As we look ahead to 2024, the Niagara real estate market presents a complex yet promising landscape. With mortgage rates expected to decrease over the next 12 to 24 months, the market is anticipated to shift towards a buyer's market, offering more opportunities for prospective homeowners. However, the economic outlook remains cautious, with potential sluggishness that could impact overall market dynamics. Despite these challenges, the forecasted increase in average sales prices and sales activity indicates a resilient market. Whether you are a buyer, seller, or investor, staying informed and adaptable will be key to navigating the Niagara real estate market in the coming year.

Frequently Asked Questions

What is the current trend in the Niagara real estate market?

The Niagara real estate market has been quite dynamic, experiencing both highs and lows over the past few years. As of early 2024, the market is expected to stabilize with a slight increase in average home prices and sales activity.

How will changes in mortgage rates affect the Niagara real estate market in 2024?

With mortgage rates expected to come down over the next 12 to 24 months, the Niagara housing market is likely to see increased buyer activity. Lower mortgage rates generally make home buying more affordable, which can drive up demand and potentially lead to higher home prices.

What are the future projections for the Niagara real estate market?

According to industry experts, the Niagara real estate market is projected to become a buyer's market in 2024. Average home prices are expected to increase by approximately 3.5%, and sales activity is anticipated to rise by 4.5%.

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