The average price of a Canadian home sold in August was $637,673, down more than 20% from February.
The Canadian Real Estate Association said on Thursday that the number of homes sold on the property group’s multiple listing service fell for the sixth straight month since the Bank of Canada began raising interest rates in March.
Home sales are down 24% from this time last year. Average selling prices have also fallen nearly $200,000 since hitting a record high of $816,720 in February.
August’s average selling price is down from its peak, but up slightly from the previous month’s $629,971.
TD Bank economist Rishi Sondhi says it would be a mistake to assume the market has reversed from this rally. turning point. ”
Toronto Attention, Vancouver Buyer’s Market
Nasma Ali, founder of real estate brokerage One Group, said Toronto’s housing market is “night and day” compared to last year, or even early 2022, before rate hikes began. said.
“People are much more cautious and fearful about jumping into the market right now,” she told CBC News in an interview Thursday. [it’s] Inflation, the economy, a looming recession.”
On the other side of Vancouver, mortgage broker Simon Bilodeau says the market is back in favor of buyers.
“Last year was very competitive and people came back who might have given up because it was hard to get something,” he said.
“The speed at which the Bank of Canada raised interest rates was expected to cool the property market.”
Bank of Montreal economist Robert Kavcic says home sales volumes are now back to roughly what they were before COVID-19 after a pandemic-induced surge due to low interest rates.
But there is still a big gap between what sellers are used to and what buyers are willing to accept.
“The conflict will continue between sellers who need to reach the reality that early 2022 prices no longer exist and buyers who simply can’t pay that much,” he said. The process could be postponed until next year.”
Market ‘Still Active’
Homeowner Pierre Bechereau is seeing a slowdown from both buyers and sellers as he is in the process of selling his home on the eastern edge of Toronto and moving to another part of the same city.
“I’m not too worried about where the market is at the moment because if it’s high and I sell… I know it’s going to be hard to find a place. If the market isn’t so hot, it’s also It means it will be “easy to buy,” he said in an interview with CBC News.
“It’s certainly not as hot as it used to be, but I think it’s still active.”
Mortgage rates have soared from about 1.5% at the beginning of the year to more than 5% now, and it will take several more months for the full impact to be felt, Kavcic said. Springs could have been pre-approved at a much lower rate than they are now.
“If you can get a discount on a mortgage rate that no longer exists, it might be attractive. is likely to take longer,” he said.