In the ever-evolving landscape of Canadian real estate, the past year has shifted the focus from housing affordability to key factors like the Bank of Canada’s future moves and the impact of immigration in 2024. Despite these shifts, the discussion around affordability remains pertinent as Canada’s home prices are still hovering above their pre-pandemic levels.
Understanding the Market Trends
October saw a slight increase in average home prices to $656,625, according to the Canadian Real Estate Association (CREA). Excluding the major markets of Toronto and Vancouver, this figure stands around $600,000. While the feverish price growth of 2020-2021 has cooled, the market hasn’t seen a significant decline in prices, even amidst higher interest rates and mortgage rates.
Is Limited Supply the Culprit?
Recent data reveals a notable decrease in property sales and a reduction in new home listings, hinting at a tightening market. The inventory numbers, although slightly improved, are still below the long-term average. This ongoing tightness in supply is a significant factor keeping prices elevated.
New Housing Construction: A Slowdown Yet Steady in Major Cities
While new housing construction mirrors last year’s figures, the overall housing starts have declined. Major urban areas continue to see robust construction activities, especially in the apartment sector, driven by strong rental demand. However, the overall increase in supply is somewhat balanced by enduring high demand.
Regional Market Variations
In Ontario, new residential listings have seen a significant year-over-year increase, surpassing average levels for this time of year. Meanwhile, British Columbia is experiencing a shortfall in active residential listings, although there’s been a slight increase recently.
Population Growth: A Price Support Factor
With Canada’s aggressive immigration targets, the demand for housing is expected to stay strong. Higher interest rates might dampen some demand, but the overall population increase could sustain the current market dynamics.
The ‘Missing Middle’ and the Path to Homeownership
The Canadian real estate market is experiencing a gap in affordable ‘middle’ housing. Until the supply increases significantly, high prices will likely continue to challenge many aspiring homeowners, whether in urban centers or smaller regions across the country.
Remax Success Realty: Supporting Agents in a Dynamic Market
In this complex market, Remax Success Realty stands out by investing in its agents, providing them with advanced marketing tools and dedicated branding support.
Our in-house team, Agent2Brand, is geared towards empowering agents with the latest strategies and technologies, ensuring they become leaders in the industry. Whether you’re starting your journey as an agent or looking to elevate your real estate career, Remax Success Realty offers the resources and support needed to thrive in today’s challenging market.
