What housing market conditions mean for homebuyers right now
It’s been a record-breaking year for Canada’s real estate market so far, with interest rates at an all-time low, and housing prices at historic highs. After a slight drop in monthly home sales, the latest statistics from the Canadian Real Estate Association show a real estate market that’s slowly reheating again.
“We were expecting some warming in the housing market again,” BMO’s Chief Economist Doug Porter told CTVNews.ca in a phone interview on Monday. “The national view suggests that the market, broadly, is looking like it’s starting to strengthen again.”
National home sales in Canada have set a new annual record this year, rising 8.6 per cent from September to October. Last month, seasonally-adjusted sales reached 53,746, compared to 49,485 sales in September.
The total sale of single family one-storey and two-storey homes, as well as townhouses and apartments, saw month-over-month increases across about three-quarters of all local markets, including all major Canadian cities. This is the largest month-over-month growth since July 2020. Along with this, more than 580,000 residential properties were sold via Canada’s MLS systems so far this year, eclipsing the annual record of 552,423 sales across all of 2020.
But perhaps the most revealing numbers stem from the MLS Home Price Index. The HPI, a tool used to gauge home price levels, is based on the values assigned to different housing attributes as they evolve over time. As Porter puts it, the index attempts to correct any distortions in the market for a purer measure of home price activity.
From September to October, the MLS HPI rose 2.7 per cent, while year-over-year, Canadian home price levels have seen a growth of 23.4 per cent.
“If you do a like-for-like comparison of houses, that’s a fairly accurate reading that a four-bedroom house in a suburb of a typical city has gone up by 20 per cent in the past year, which is a phenomenally strong number,” said Porter.