The housing slowdown continued in November with home sales down over 50% year-over-year in some of the country’s biggest cities.
Greater Vancouver led the way, with sales falling 53% year-over-year. The MLS Home Price Index benchmark price, however, was down just 0.5% to $1,131,600 compared to November 2021.
In the Greater Toronto Area, sales were down 49%, though the average selling price was down 7% year-over-year to $1,079,395, which was down another 1% from October. Average days on the market also rose to 33 days, up from 18 a year earlier.
“Selling prices declined from the early year peak as market conditions became more balanced and homebuyers have sought to mitigate the impact of higher borrowing costs,” said Jason Mercer, Chief Market Analyst at the Toronto Regional Real Estate Board (TRREB). “With that being said, the marked downward price trend experienced in the spring has come to an end. Selling prices have flatlined alongside average monthly mortgage payments since the summer.”
Prices and activity under “intense downward pressure”
But make no mistake, Canada’s housing markets remain “squarely in correction mode,” noted RBC economist Robert Hogue.
He said the latest results from various local real estate boards across the country confirm that both prices and activity remained “under intense downward pressure” in November.
“This was entirely expected considering the heavy toll soaring interest rates are taking on buyers from coast to coast,” he wrote. “Higher rates are forcing many of them to put their purchase plans on ice and others to house-hunt on a reduced purchasing budget. We think this will continue to be the case into the early part of 2023—conditional on the Bank of Canada halting its rate hiking campaign this month.”
Here’s a look at the November statistics from some of the country’s largest regional real estate boards:
Greater Toronto Area
- -49% (YoY)
- -8.5% month-over-month (MoM)
Average price: $1,079,395
New listings: 8,880
Active listings: 11,910
“Increased borrowing costs represent a short-term shock to the housing market. Over the medium- to long-term, the demand for ownership housing will pick up strongly,” said TRREB President Kevin Crigger.
“This is because a huge share of record immigration will be pointed at the GTA and the Greater Golden Horseshoe (GGH) in the coming years, and all of these people will require a place to live, with the majority looking to buy,” he added. “The long-term problem for policymakers will not be inflation and borrowing costs, but rather ensuring we have enough housing to accommodate population growth.”
Source: Toronto Regional Real Estate Board (TRREB)
Greater Vancouver Area
MLS Home Price Index benchmark price: $1,131,600
New listings: 3,055
Active listings: 9,971
“With the most recent core inflation metrics showing a stubborn reluctance to respond significantly to the furious pace of rate increases, the Bank of Canada may choose to act more forcefully to bring inflation back toward target levels,” said Andrew Lis, REBGV Director, economics and data analytics. “While it’s always difficult to predict what the bank will do with certainty, this persistent inflationary backdrop sets up the December 7 rate announcement to be yet another increase, making holiday-season home purchases something people may end up foregoing this year.”
Source: Real Estate Board of Greater Vancouver (REBGV)
Montreal Census Metropolitan Area
Home Sales: 2,716
Median Price (single-family detached): $520,000
Average Price (condo): $380,000
New listings: 4,767
Active listings: 16,397
“November’s sharp drop in sales echoes the rapid rise of interest rates. This transactional level, which is among the lowest levels recorded by the Centris system, continues to result in a backlog of active listings in the Montreal CMA market. Nevertheless, in November, the number of new listings is trending downward again, indicating that potential sellers are not rushing to sell their properties, or are not yet feeling compelled to do so,” said Charles Brant, Director of Market Analysis. “Market conditions continue to favour sellers. This is particularly true for properties offering good value for their price, which are still actively sought after by keen buyers.”
Source: Quebec Professional Association of Real Estate Brokers (QPAREB)
Benchmark Price (all housing types): $520,200
New listings: 1,611
Active listings: 3,111
“Easing sales have been driven mostly by declines in the detached sector of the market,” said CREB Chief Economist Ann-Marie Lurie. “Higher lending rates are impacting purchasers buying power and limited supply choice in the lower price ranges of the detached market is likely causing many purchasers to place buying decisions on hold.”
Source: Calgary Real Estate Board (CREB)
Average Price (residential property): $680,031
Average Price (condominium): $415,533
New Listings: 1,598
“November’s sales were expectedly low given the typical slowdown this time of year, but they also reflect today’s economic conditions,” said OREB President Penny Torontow.
“What’s concerning about the current market is the impact on first-time homebuyers,” she added. “The marked decrease in condo sales, for example, signals that even entry-level properties are being affected. Fluctuating markets, paired with the stress test, are keeping first-time buyers on the sidelines in a tight rental market—with MLS rentals increasing 27% this year over last.”
Source: Ottawa Real Estate Board (OREB)