Manitoba Daily

Saturday, February 24, 2024

Since July 2020, home sales have increased the most: CREA

Key takeaways:

  • According to the Canadian Real Estate Association, home sales in October increased by the most since July 2020.
  • The national average home value in October 2020 was $716,585, up 18.2 per cent from October 2020.

As per the Canadian Real Estate Association, home sales in October had their greatest month-over-month increase since July 2020, despite a 20% drop in new listings from a year ago.

According to the group, seasonally adjusted sales increased by roughly 9% to 53,746 last month, up from 49,485 in September.

Sales were 52,538, down 11.5 per cent from 59,344 last October on a non-seasonally adjusted basis.

The year-over-year reduction in sales, combined with declining inventory levels and rising prices, was taken by realtors and analysts as an indication of further market tightening.

While buyers hurried to acquire properties at the end of last year, this year seems to be different despite COVID-19 regulations ruining their vacation plans and keeping them physically apart.

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“Buyers are very discouraged, very fatigued, and they just feel like they’re being priced out all the time,” Nasma Ali, a Remax Hallmark Realty broker, said.

“A lot of purchasers are starting to suggest that maybe it’s not in the cards for us this year, and we should take a vacation and come back in the new year.”

They are discouraged since fewer homeowners are willing to sell their properties.

“Those who do want to move up are stymied because they can’t find a place to live until their house sells,” Ali explained.

Last month, the number of fresh listings was 61,128, down nearly 20% from 76,046 at the same period last year.

Dominion Lending Centres chief economist, Sherry Cooper, does not expect listings to improve any time soon.

“Canada continues to face one of the most severe housing shortages in the developed world,” she wrote in a note to investors.

“Excess demand for homes will rise as our borders open to a rebirth of immigration.”

As a result, the sellers may command even greater prices than they did last month.

Month-over-month homes sales see biggest increase since July 2020: CREA

The national average home value in October 2020 was $716,585, up 18.2 per cent from October 2020.

Excluding the Greater Vancouver and Greater Toronto Areas lowers the national average price by more than $155,000.

Senior economist Robert Kavcic of BMO Capital Markets believes that rising prices signal a need for the government and regulatory authorities to intervene.

In a note to investors, he said, “The Canadian housing market is long overdue for higher rates, and momentum is still going upward until it receives them.”

After a “slowing” in the summer, he interpreted the October data as a sign that the market had “completely firmed up.”

“Thanks to low mortgage rates, a solid job market, expectations of ongoing price growth, and perhaps some more activity ahead of mortgage rate hikes (especially for those with a contract in hand),” he said, “the market is still extremely tight, and demand is still voracious.”

Ali believes that some buyer fatigue will subside in the new year, especially if rates continue low, but that supply will remain scarce for months.

“We’ll have a lot more purchasers in January and February, and we’ll have all the folks who are exhausted and fatigued now coming back in January and February, and we’ll still have no inventory,” she said.

“So it’s not going to get any better in January,” she says, “but I think it’ll get a little better in the spring when there’s more inventory.”

Source: CTV News

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