The Canadian Real Estate Association says home sales across the country experienced their largest monthly increase in October since July 2020, despite the number of new listings falling by around 20% compared to a year ago.
Seasonally adjusted home sales totaled 53,746 last month, up nearly 9% from 49,485 sales in September, according to the association.
On an unadjusted basis, there were 52,538 sales, down 11.5% from 59,344 sales in October 2020.
Real estate agents and economists have interpreted declining year-over-year sales along with dwindling inventories and rising prices as a sign of further tightening in the market.
Although buyers rushed to buy properties late last year, as COVID-19 restrictions ruined their vacation plans and kept them physically away, this year is shaping up to be different.
“The buyers are very discouraged, very tired, and they just feel like the prices are constantly unaffordable,” said Nasma Ali, a broker at Remax Hallmark Realty.
“A lot of buyers are starting to think that maybe it’s not in their plans this year, and maybe we should take a break and start looking next year,” she said. Explain.
They are discouraged because fewer homeowners are willing to put their homes on the market.
The number of new registrations last month was 61,128, down almost 20% from 76,046 in the same period last year.
Those who resisted the trend and put their homes up for sale got increasing prices.
The unadjusted national average home price was $ 716,585, up 18.2% from October 2021.
Excluding homes in the Greater Vancouver and Greater Toronto Area, the national average price drops by over $ 155,000.
BMO Capital Markets Senior Economist Robert Kavcic believes rising prices mean it’s time for government and regulators to curb current conditions.
“It is high time the Canadian housing market had higher rates, and momentum is still on the rise until they are,” he wrote in a note to investors.
He analyzed the October data as a sign that the market is “completely firmed” after a “slowdown” over the summer.
“The market is still tight and demand continues to flourish thanks to low mortgage rates, a strong job market, expectations of continued price hikes and possibly additional activity ahead of mortgage rate hikes. [en particulier pour ceux qui ont un contrat en main] », He believes.
Ms Ali believes some of the buyer exhaustion will subside in early 2021, especially if rates remain low, but she believes inventory will still be hard to come by for months.
“In January, February, there will be a lot more buyers and we will have all the tired people coming back. […] and we still don’t have an inventory, ”she projected.
“So it won’t improve in January, but I think that in the spring, when there will be more inventories, it will be a little better. “
Note to readers: This is a corrected version of a dispatch transmitted on November 15, 2021. In an earlier version, The Canadian Press wrote that unadjusted sales and national average house prices were down from 2021. They are both down from 2020.