Is this the slower real estate market buyers have been waiting for? Canada’s largest markets are said to be suffering from fewer sales this fall, according to the September report from the Canadian Real Estate Association (CREA).
The fall real estate market usually sees a boom in sales as prospective buyers make one last attempt to score that townhouse for sale in Toronto or real estate in Hamilton before the retiring their searches for the winter.
However, CREA’s recent report shows this autumn is bucking that trend; while activity in the market has risen by 2.1 percent from August, sales are down by 11 per cent in the majority of the local markets compared to 2016, and down by 12 per cent compared to the market’s peak in March.
However, prices are still on the rise, with benchmark prices up 2.8 per cent across all 13 of CREA’s tracked MLS markets, to an average of $487,000. This growth is led by condos, which have seen values increase by 19.8 per cent, and townhouses, which are up by 13.5 per cent. This indicates lower-priced housing types remain most-sought by prospective buyers, as detached home prices remain well above the million-mark in Toronto and Vancouver.
Check out the infographic below to see how sales and prices have shifted in the third quarter across Canada:
A More Stable Time for Buyers?
While conditions appear to be levelling out in the aftermath of the Ontario Fair Housing Plan, a new crop of mortgage rules could throw buyers into flux once again.
“Further tightening of federal regulations aimed at cooling housing markets in Toronto and Vancouver risks creating collateral damage in markets elsewhere in Canada. It also jeopardizes Canadian economic growth, which is already showing signs of fading.” Stated CREA’s Chief Economist Gregory Klump.
President Andrew Peck also said sales seem to be stabilizing, but warned caution is needed when analyzing the market, until conditions are proven to be longer-term trends.
Buyers’ Market Conditions Continue
CREA reports that new homes listed for sale rose 5 per cent, following three months of declines. This, coupled with slower sales, has put downward pressure on the national new-sales-to-listings ratio, pushing it to 55.7 per cent, from 57.7 per cent in August.
In the Greater Toronto Area, the ratio now sits at 56.1 per cent, well within the realm of balanced territory.
In fact, conditions are started to tighten back up in the region after plunging below the 40-per-cent benchmark, following the implementation of the Ontario Fair Housing Plan in June.
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