The ongoing slowdown in Canada’s two most expensive housing markets continued in June, with new figures showing that the number of homes sold in Toronto and Vancouver fell by more than a third, and average prices now they have gone down for several consecutive months.
The Toronto Regional Real Estate Board (TRREB) said 6,474 homes were sold in the Greater Toronto Area last month, 41% less than last June.
As happened in many parts of Canada, home prices in and around Toronto exploded during the COVID-19 pandemic, as record low interest rates allowed buyers to stretch their budgets to buy more expensive houses. But that trend changed direction abruptly in March of this year, when the Bank of Canada began raising interest rates.
The impact on the market was almost immediate as sales and new listings slowed, and the usual bidding wars began to fade as buyers could afford to be more select. .
“Home sales have been affected both by the affordability challenge posed by rising mortgage rates and by the psychological effect that home buyers who can afford higher loan costs have put the their decision is pending to see where house prices end, ”TRREB President Kevin Crigger said. “Expect current market conditions to remain slower during the summer months.”
There is also a slowdown on the price side, although it is not as pronounced as that which is occurring on the volume side.
The average price of a home sold during the month was $ 1,146,254. This is an increase of five percent compared to the same month a year ago, but has fallen steadily for four consecutive months.
The average selling price has dropped 14 percent from a high of more than $ 1.3 million in February.
Lower prices are welcome news for buyers, but that doesn’t mean things are necessarily more affordable.
Kriti Bhardwaj and her husband, Sachin Advani, have been out of the market for a few years now, looking for an opportunity to buy. But while they see asking prices declining, they realize that the rate they would have to pay on any new mortgage is rising even faster, keeping many homes out of their reach.
“I think it’s a gradual process, and it may take a few more months to see a significant decrease compared to the [price] The increase was in 2021, ”Bhardwaj said.
“[But] everything is cooling down, “he said.” There are more properties on the market and there are fewer buyers. “
MIRAR | Toronto’s hot real estate market is cooling:
Toronto’s real estate market continues to slow, with sales down 41% compared to last June
The ongoing slowdown in the Toronto real estate market continued last month, with new figures showing that the number of homes sold in Canada’s largest city fell by almost half compared to a year ago.
The slowdown also in Vancouver
It’s a similar story on the other side of the country, as sales in Vancouver fell 35 percent compared to last year’s level, although prices so far are holding up a little better.
The benchmark selling price in Greater Vancouver stood at 1,235,900 during the month, up 12% from last year, but a drop of more than two percent over the past three months.
Real estate agent Steve Saretsky said there has been a “fairly significant change of direction” since February, especially in suburban communities outside the city center, where prices rose more when working from home they were rigorous.
“Anything more than an hour out of town is experiencing the biggest decline, but they probably also increased more,” he told CBC News in an interview.
Saretsky said that higher interest rates have initiated a correction in the overheated real estate market of the city, but it is important to remember that falling prices are only coming down from their unsustainable peaks.
“They were really kind of fictitious prices that people [had a] fear of getting lost and overpaying, competing with 10 more people in some of these houses. “