High prices

It might finally be time for Canadian homeowners to sell Early indications suggest that more house sellers are entering the Canadian housing market, which is good news for purchasers who have been dealing with supply constraints for some time. According to a recently released RBC Thought Leadership analysis by senior economist Robert Hogue, while one month does not always equal a trend, February’s market statistics indicate that more house sellers may be entering the market. Month-to-month gains in new listings have been reported by real estate boards around the nation, notably in Calgary and Edmonton, which had the highest number of transactions ever recorded in February. Purchasers continue to face a shortage of housing supply, which is driving up prices, particularly in locations like the Fraser Valley, Toronto, and Vancouver, where prices have risen steadily. “Sellers will play a central role in shaping up this year’s spring season,” said Hogue. “Should a critical mass of current homeowners see the coming months as an opportune window to list their property—now that interest rates are on the rise and ahead of potential policy actions targeting speculators—it would ease some of the supply restraints, both boosting near-term activity and reducing some of the pressure of prices,” he added. Hogue predicted that if the number of house sellers does not rise, present price trends will “likely remain” until major interest rate hikes reduce demand. Prices are rising in Toronto while the market in Vancouver becomes more balanced. Last month, home prices in the Toronto area skyrocketed, while the market in Vancouver remained flat. The aggregate MLS Home Price Index (HPI) for Toronto increased by 6.4 percent in February compared to January,  more than $80,000 in a single month. Following a $52,000 gain in January, the index has risen 35.9% since February 2021. The benchmark price in Toronto is $1.34 million, which is the highest in the country. “Despite crushingly poor affordability, demand remains exceptionally brisk at this stage,” said Hogue. “Buyers pounced on a larger offering of homes for sale in February, causing resales to climb 5.9 percent from January (on a seasonally-adjusted basis).” This is the second-busiest February on record, but increasing rates are expected to decrease demand over time – high prices and a significant presence of investors “make the market especially sensitive to rising interest rates.” As more listings became available on the west coast, market activity decreased. According to RBC, resales in the Vancouver region were down 6% from January, while new listings were up 12%. These trends might be a “welcome first step” toward more balanced market conditions in the Vancouver area, according to Hogue, however he added that high demand and short inventory would “keep the heat” on property values. Last month, the composite MLS HPI in Vancouver increased by 4.6 percent to $1.31 million, an increase of almost $58,000. Values have climbed by $226,000, or 20.8 percent, in under a year. “Buyers clearly face an extremely challenging situation. Higher interest rates will make things even more difficult for many, further crushing affordability in the period ahead,” said Hogue. “We expect this will gradually suppress demand later this year and contribute to the market rebalancing.” Calgary has had a record-breaking February, with a rise in sales and listings. Calgary had a strong showing in February’s market. With 3,300 transactions, resales increased by 19% month over month, making February the best month in Calgary history. This comes after a string of nine to fifteen percent month-to-month sales improvements. Sales were up 69 percent from January owing to an influx of new listings.“It provided many buyers the options they had been seeking for some time amid shrinking inventories. These new buying opportunities came at a steeper price though,” said Hogue, who observed that Calgary’s composite MLS HPI grew 5.9 per cent — about $27,000 — between January and February. Related posts. It might finally be time for Canadian homeowners to sell by admin123 Plans at the New Bloor-Lansdowne GO Altered for Height and Park Size. by admin123 By the end of Q1-2022, GTA may witness launch of 9,750 additional condo units by admin123 Home Prices in Toronto hits an all time new record by admin123 Did Canadian housing market turn the tide? by admin123 Home Prices in Toronto hits an all time new record by admin123