Canadian housing market almost stagnant in March, CREA reveals

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The Canadian Real Estate Affiliation is anticipating the nationwide housing market to “pick up on some level this year,” regardless of one other month of sluggish exercise in March.

CREA month-to-month knowledge reveals the benchmark residence value dipped by 0.3 per cent to $718,400 for the month, whereas gross sales inched up 0.5 per cent from February. Regardless of the uptick, gross sales stay roughly 10 per cent under their 10-year common.

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In the meantime, newly listed properties declined by 1.6 per cent, however rebounded towards the tip of the month that adopted by into April.

“Weekly tracking showed a bounce in new supply around the second week of March, which led to a burst of sales in the last week of the month, and a jump in listings in the first week of April,” CREA mentioned in its March market report.

CREA senior economist Shaun Cathcart mentioned the impression of the elevated variety of properties on the market on purchaser behaviour is unsure, and that the complete image will solely turn into clear as soon as the April knowledge is obtainable.

Nonetheless, he predicts that the market might see a mixture of individuals staying on the sidelines resulting from excessive rates of interest and others returning to the market resulting from anticipated charge cuts.

Different trade observers are satisfied that rates of interest will exert a big affect in the marketplace, significantly in mild of latest developments within the bond market.

On Wednesday, an inflation report from the USA Bureau of Labor Statistics revealed a sharper-than-expected enhance in client costs, impacting bond yields in each the U.S. and Canada.

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“Based on what’s been happening in the bond market over the last few weeks, don’t be surprised if fixed rates increase further in April,” actual property monetary knowledgeable Clay Jarvis mentioned in an electronic mail. “Depending on how high they go, it might even be enough to cool activity in our more affordable cities.”

He famous that as mounted rates of interest inched increased in March, it comes as no shock to see a decline in gross sales inside Canada’s priciest actual property markets.

In response to CREA, Toronto and Vancouver noticed gross sales drop by 4.9 per cent and 4.8 per cent yr over yr in March, whereas Montreal, Calgary, Edmonton and Halifax skilled will increase of 14.2 per cent, 10.3 per cent, 34 per cent and 21.4 per cent, respectively.

Regardless of lingering hopes for an actual property market rebound this yr, Financial institution of Montreal economist Robert Kavcic additionally believes that developments within the bond market will curtail any potential reduction.

“The amount of easing might be limited by much tougher U.S. inflation trends,” Kavcic mentioned. “The market is currently pricing in just over two rate cuts in 2024, which would be far short of the relief many were hoping for coming into 2024.”

• E mail: shcampbell@postmedia.com

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