Toronto’s latest real estate figures suggest the housing market may be in the midst of a rebound, according a Desjardins economist, though he cautions that the full impact of elevated rates has yet to play out.
New data from the Toronto Regional Real Estate Board shows the city saw 3,444 home sales in December, an 11.5-per-cent climb compared to a year ago. The average price for a home climbed 3.2 per cent to $1,084,692.
Marc Desormeaux, principal economist at Desjardins, said he believes the numbers show Toronto’s real estate market may be on the upswing, as the Bank of Canada appears to have paused its rate hiking cycle.
“We are seeing some signs that perhaps the worst of the drag from the second round of monetary tightening is behind us in Toronto, but we’ll wait to see what happens in the spring real estate season,” he told BNN Bloomberg in a television interview on Thursday.
“We haven’t yet seen the full impacts of higher rates on the broader Canadian economy.”
New listings declined in the month, with 3,886 in December compared to 4,161 a year ago. Desormeaux suggested the generally high number of listings shows Toronto homeowners are struggling to keep up with the high interest rates.
“For folks who bought a home in 2019 or 2020 at ultra-low rates, if they’re on a fixed five-year term, then they’re going to be renewing at much higher rates in the next few years,” he said.
“We see a situation in which a much larger share of Canadians’ income goes to the service of mortgage debt. That means there’s less money available for other types of consumer spending.”
RATE OUTLOOK
Desormeaux predicted some relief on the horizon in the form of rate cuts. He expects the Bank of Canada will start cutting interest rates in the middle of 2024, with its trendsetting rate coming down to around 3.5 per cent by the end of the year.
“It’s important to note that we’re not anticipating that we’re going back to ultra low rates, below one per cent on the overnight rate per instance,” he said.
“That means the mortgage renewal question will be a big one for the Canadian economy over the next few years.”
The Bank of Canada’s next rate announcement is scheduled for Jan. 24.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
MONTREAL – The Quebec Professional Association of Real Estate Brokers says Montreal-area home sales rose 9.3 per cent in August compared with the same month last year, with levels slightly higher than the historical average for this time of year.
The association says home sales in the region totalled 2,991 for the month, up from 2,737 in August 2023.
The median price for all housing types was up year-over-year, led by a six per cent increase for the price of a plex at $763,000 last month.
The median price for a single-family home rose 5.2 per cent to $590,000 and the median price for a condominium rose 4.4 per cent to $407,100.
QPAREB market analysis director Charles Brant says the strength of the Montreal resale market contrasts with declines in many other Canadian cities struggling with higher levels of household debt, lower savings and diminishing purchasing power.
Active listings for August jumped 18 per cent compared with a year earlier to 17,200, while new listings rose 1.7 per cent to 4,840.
This report by The Canadian Press was first published Sept. 6, 2024.
