Real eState
LACKIE: Could spring real estate market be the start of a new cycle?
In some cases we are actually seeing prices we might have seen at the peak back in February 2022.
This would have likely been inconceivable even a month ago, and yet here we are.
The only thing holding us back — or perhaps I should say, propping us up — appears to be the reality we are also contending with the tightest inventory levels in decades.
As such, affordability, or really the complete lack thereof, seems to be secondary in the face of such buyer motivation.
While some have quite clearly determined the worst is behind us, others are bracing themselves for what comes next should economic hard-landing lie ahead — a painful recession with widespread unemployment isn’t a complete impossibility is it?
Nonetheless, at this moment there are a whole lot of buyers willing to throw caution to the wind and shoot their shot.
For a whole generation of Boomers well into retirement, sitting on a windfall of equity, and grappling with the when of downsizing into that perfect condo, the last year has likely included feelings of regret in those banking on their homes funding their next act.
As transactions ground to a halt and prices fell, there were many wondering if they had missed their moment in their attempt to catch the top of the market.
With only previous corrections to use as a guide, the possibility that recovery could take years with prices grinding sideways for the foreseeable future was a reasonable belief that likely fuelled some regret over the past 12 months.
Clients who had planned to take their time and consider listing in the fall are now charging full speed ahead into purpose-built rental buildings, recognizing a viable, though perhaps not completely ideal, interim solution as they contemplate what’s next while still getting their houses up on the market to catch this rally.
If enough older homeowners cycle out of the housing market, one could reasonably assume that this will unlock the chessboard allowing for some movement. Every agent I know has a list of move-up buyers waiting in the wings, ready to rock and roll the moment the right house comes up.
If interest rates sitting at 6% aren’t pressuring average sale prices down anymore, it’s more likely that insufficient inventory is the real element at play and that isn’t likely to improve any time soon.
Especially when we have municipal governments doing pretty much everything but prioritizing getting housing built, a federal government barrelling right ahead with their plans to welcome as many immigrants as possible with seemingly zero concern as to how to house and service those new Canadians, and housing starts at all-time lows.
If and when rates come down even slightly, which industry experts seem to think isn’t so far off, I suspect we will be looking at the cycle starting all over again, which will be terrible, terrible news for the generation of Canadians priced out of housing.
But are people furious? Because they should be.
TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.
The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.
The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.
“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”
The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.
New listings last month totalled 15,328, up 4.3 per cent from a year earlier.
In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.
The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.
“I thought they’d be up for sure, but not necessarily that much,” said Forbes.
“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”
He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.
“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.
“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”
All property types saw more sales in October compared with a year ago throughout the GTA.
Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.
“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
This report by The Canadian Press was first published Nov. 6, 2024.
The Canadian Press. All rights reserved.
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
The Canadian Press. All rights reserved.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
The Canadian Press. All rights reserved.
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