According to the Canadian Real Estate Association (CREA), September was a bit of a mixed bag.
Canadian buyers continued to take their foot off the gas last month. CREA recorded national home sales dropped 1.9 per cent year-over-year. September marked the third straight month of sales decreases. On the bright side, the slide was only half as large as the numbers recorded in August.
Canadians may not be buying, but they have begun listing once more. The number of newly listed homes increased 6.3 per cent on a month-over-month basis in September, making for a cumulative gain of about 35 per cent from the 20-year low in March. New listings are trending near average levels.
Watching and waiting
“The recent trend of slowing sales and rising new listings continued in September,” said Larry Cerqua, CREA chairperson. “This presents an opportunity for buyers, although many of them seem content to stick to the sidelines until there’s more evidence that interest rates are indeed finally at the top.”
“This, combined with sellers who, by and large, do not need to sell, means the market will likely remain on the slower side until next year,” continued Cerqua.
“Resale housing markets have settled down pretty quickly following this spring’s brief and somewhat surprising rebound in sales and prices,” said Shaun Cathcart, CREA’s senior economist.
“With the inventory of homes for sale still historically low amid huge demand for housing in Canada, what happens next will depend on interest rates. Whether that means uncertainty about the possibility of further hikes or the cost of borrowing money right now, neither of these will be resolved for would-be buyers anytime soon. As such, expect a quieter than normal winter with all eyes on the Bank of Canada. We’ll see how buyers are feeling when the snow starts to melt.”
In September 2023, the Aggregate Composite MLS Home Price Index (HPI) saw its first monthly dip, down 0.3 per cent since March.
Ontario’s patterns were responsible for the modest September price decline. In some provinces, prices are still rising, but slower than in previous months.
The next several months will see the arrival of data that will indicate whether Ontario is an anomaly or merely the first province to exhibit the kind of softening pricing trends that, given the current state of interest rates, would be expected to play out in at least some other regions of the nation.
