Housing prices have been declining, but 2022 wasn’t catastrophic and 2023 is looking better

Most pundits believe the long-term outlook for housing is positive, but any kind of consensus on the short-term future of housing markets is lacking, with some believing that prices will continue to fall this year while others see a turnaround once interest rates stabilize.

These contrasting views make one wonder how reviewing the same statistics and trends can lead to such diverging forecasts. In parsing the housing market, though, motivations matter.

For example, suppose the data is being reviewed by those told-you-so pundits who have been predicting an imminent market crash for decades. Their market pronouncements will tend to sound bleaker despite their crash forecasts being wrong year after year. On the other hand, those whose welfare may be tied to a quick market recovery will spot a silver lining in every dark cloud. For them, the glass is never half empty.

Our review of the December 2022 data from the Canadian Real Estate Association (CREA) reveals trends that contrast with the oft-repeated gloom-and-doom headlines.