In the realm of real estate, the cities of Toronto and Vancouver have long stood…
Despite higher annual home sales in most major housing markets across Canada, activity and prices have cooled down compared to the previous month, as per early monthly data from major real estate boards. The Bank of Canada‘s June rate hike and the possibility of further rate increases in July have resulted in a mixed reaction across local housing markets.
Toronto and Vancouver Experience Sales Decline
In Toronto, sales were down by 18% compared to the previous month, and the average benchmark price decreased slightly over 1%. Similarly, Vancouver witnessed a 13% decline in home sales on a month-over-month basis.
Impact of Rate Hike on Homebuyer Sentiment
The real estate boards agree that the Bank of Canada’s decision to resume rate hikes is influencing homebuyer sentiment. Rising interest rates and a decline in new listings are sending a negative signal to market participants, leading some to consider postponing their buying or selling plans.
Activity Remains Higher YoY in Most Markets
Despite seasonal slowdown, overall activity remains higher in most markets compared to the same period last year. Calgary experienced strong activity with sales up by nearly 11%, and prices rising by 4.4% from the previous year, buoyed by a healthy labor market and increased migration levels.
Regional Housing Market Roundup
Here are some statistics from June in selected regions:
- Greater Toronto Area (GTA)
- Sales: +16.5% YoY
- Benchmark price (all housing types): +3.2% YoY
- New listings: -3% YoY
- Active listings: -12.3% YoY
- Greater Vancouver Area
- Sales: +21.1% YoY
- Benchmark price (all housing types): -2.4% YoY
- New listings: +1.3% YoY
- Active listings: -7.9% YoY
- Apartment segment shows relative strength.
- Montreal Census Metropolitan Area
- Sales: -10% YoY
- Median Price (single-family detached): -4% YoY
- Median Price (condo): -5% YoY
- New listings: -19% YoY
- Active listings: +32% YoY
- Sales: +10.9% YoY
- Benchmark price (all housing types): +4.4% YoY
- New listings: -2.9% YoY
- Active listings: -36% YoY
- Sales: +11% YoY
- Average Price (residential property): -4% YoY
- Average Price (condominium): +2% YoY
- New listings: -14% YoY
The impact of the Bank of Canada’s rate hike has varied across different regions, affecting buyer and seller behavior. While some markets experienced a decline in sales due to economic uncertainty, others have seen robust demand despite higher borrowing costs.
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