The decline in national home sales reported Tuesday by the Canadian Real Estate Association is “disappointing” says TD Economics.
Economist Rishi Sondhi highlighted in a note the lower sales, and activity weaker than originally thought; and said that the sales declines were broadly-based on a provincial basis.
In his assessment of the data, Sondhi points to the impact of the recent tightening of the B-20 mortgage lending guideline and provincial regulations that have softened some regional markets.
However, he does not expect any major shocks for the housing market in the months ahead.
“Going forward, we anticipate these factors will continue to weigh on activity and sentiment,” he wrote. “Having said that, we don't expect the outsized declines in activity that were observed in the first quarter to be repeated in most places except for B.C., where these factors will continue to be further exacerbated by the recently introduced provincial regulation, intended to cool activity in some higher priced markets.”
Sondhi expects things to balance out during 2018 and into next year.
“Ultimately, signs of stabilization should emerge later in the year and into 2019, amid healthy labour markets and ongoing population growth,” he wrote.