Prospective homebuyers had “more choice” in Canada’s housing market in August as a rise in new listings met a slowdown in activity, according to the national real estate association.
Home sales fell 4.1 per cent between July and August, the Canadian Real Estate Association (CREA) said Friday.
Slowdowns in the Greater Vancouver Area, the Fraser Valley, Montreal, Ottawa and few other Ontario cities drove the decline, CREA said.
Despite the cooling, the average national home price was up 2.1 per cent year-over-year to just over $650,000 last month.
CREA’s aggregate composite Home Price Index, which gives a more like-to-like comparison of property sales by class, was up 0.4 per cent month-to-month. The association said this was about half the monthly jump seen in July, which itself was half the gains seen in preceding months.
The number of new listings on the market also edged up in August, CREA said. The sales-to-new listings ratio — a key metric for determining balance in the housing market — eased to 56.2 per cent in August from 59 per cent in July. That’s down from a peak of 67.4 per cent this past spring and more in line with the long-term average of 55.2 per cent, CREA said.
“With sales slowing and new listings returning to more normal levels, demand and supply are continuing to come into better balance,” CREA chair Larry Cerqua said in a statement.
“This is giving buyers more time and more choice.”
CREA’s senior economist Shaun Cathcart said in a release the slowdown in the market was expected given the Bank of Canada’s interest rate hikes in June and July.
He said demand is still there and will likely return, but with buyers boxed out of the market for the time being, prices are expected to stabilize nationally.
That’s not necessarily the case regionally, however.
CREA said price growth has remained solid in Quebec and on the east coast, with gains also seen in parts of British Columbia and the Prairies.
Ontario was meanwhile described as a “mixed bag,” with some markets seeing prices climb as others face significant declines.
© 2023 Global News, a division of Corus Entertainment Inc.