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<\/a>Photo:\u00a0Tiago Rodrigues<\/a>\/Unsplash<\/a><\/em><\/p>\nThe precipitous drop in Canadian home sales observed in the second half of March will set the stage for an even steeper decline in April, according to a market commentator with TD\u2019s economics team.<\/p>\n
As the COVID-19 crisis intensified, economist Rishi Sondhi said that the collapse in homebuying activity was evident in many markets across the country in data released this week by the Canadian Real Estate Association (CREA).<\/p>\n\n
\u201cSeveral jurisdictions reported collapsing activity in the back half of March, as the number of COVID-19 cases and associated social distancing measures ramped up. Looking to April, a record decline in sales is in store, as these pressures remain,\u201d wrote Sondhi in a research note published Wednesday.<\/p>\n
Just how deep the decline will be remains to be seen, but CREA Senior Economist Shaun Cathcart said<\/a> that early data from the first week of April \u201csuggest both sales and new listings were only about half of what would be normal for that time of year.\u201d<\/p>\n While the numbers for April are certain to be bleak, TD\u2019s Sondhi believes there\u2019s reason to be optimistic about the stability of the Canadian housing market. He points to the fact that listings have sunk along with sales, meaning there\u2019s no ramp up in supply during a time when demand has dried up.<\/p>\n \u201cThis is keeping markets balanced and maintaining a floor on prices. The sharp decline in March new listings (with another massive drop likely to occur in April) suggests that financial stresses have not (yet) compelled households to list their homes en masse,\u201d Sondhi wrote.<\/p>\n