The Canadian Real Estate Association is downgrading its Canada housing market forecast for the remainder of the year again. It has been saying that the Bank of Canada’s interest rate cuts have not contributing to the gradual improvement it previously anticipated. To this, the CREA said it now thinks the national housing market will remain in “more of a holding pattern”. This will happen until next spring with 468,900 properties forecast to trade hands this year. This means that it would mark a 5.2 percent increase from 2023. This would be down from its July prediction of a 6.1 percent bump. This will make its April outlook of 10.5 percent on play.
The revised forecast came as CREA effectively reported the latest national home sales and pricing data for September. It also said that the average price of a home sold last month amounted to $669,630. This was up to 2.1 percent from September 2023. The association to it, said that it is now forecasting to just a 0.9 percent annual increase. This was to be done for 2024 to $683,200, which will be down from its previous outlook of a 2.5 percent annual increase.
Canada Housing Market: What Happened From Year To Year?
On a year-over-year basis on the Canada housing market, the number of homes that changed hands in September rose to 6.9 percent. However, the CREA said that the sales ticked up to just 1.9 percent. This happened on a month-over-month from August after the Bank of Canada’s third straight rate cut. Furthermore, there were 185,427 properties listed for sale across Canada. This was available at the end of September. Up to 16.8 percent from a year it rose earlier, however, it was still below historical averages of around 200,000 for this time of the year.
New listings also grew upto 4.9 percent on a month-over-month in September. This was due to broad-based gains across most of the country’s biggest markets. To this, the association said that a “sharper rebound” is expected by next spring.
“Sales gains are now three for three in the months following interest rate cuts, which is a trend even though the increases weren’t headline-grabbing,” said CREA senior economist Shaun Cathcart in a press release.
“That said, with the pace of rate cuts now expected to be much faster than previously thought, it’s possible some buyers may choose to hold off on a purchase for now. This could further boost the rebound expected in 2025 at the expense of the last few months of this year.”
The Bank of Canada began its rate-lowering process in June. It has also added a cut to its key rate by a quarter-percentage point. This was a total of three times so far this year, thus bringing it up to 4.25 percent.
Canada Housing Market: When Does The Central Bank Face Its Next Interest Rate?
The central bank faces its next interest rate decision on the Canada housing market on October 23. On this, governor Tiff Macklem has said that it is reasonable to expect more cuts. These are coming given the recent progress made on lowering the level of inflation.
Furthermore, the CREA said on Tuesday that it anticipates about national home sales climbing upto 6.6 percent in 2025. This was done as interest rates continue to decline and spur the renewed demand. While the average home prices are forecasted to rise upto 4.4 percent to $713,375 next year regarding the Canada housing market.
Statistics About The Canada Housing Market
Below given is the statistics which is related to the Canada housing market. Therefore, look at these details given by the Canada housing market:
