The national average residential sale price in Canada is expected to decline by 2.2 per cent in the final months of this year, according to RE/MAX Canada’s 2022 Fall Housing Market Outlook Report, which was released on Wednesday.
The report said the “market moderation” comes on the heels of rising interest rates, record-high inflation and broader global and economic uncertainties that have impacted consumer confidence and market activity. Bucking the downward trend, six out of 30 markets analyzed are likely to experience modest price appreciation between 1.5 and seven per cent. Meanwhile, RE/MAX brokers and agents expect a decline in sales this
fall, in 24 out of 30 markets surveyed, added RE/MAX.
“While we are still facing significant housing supply shortages across the country, many markets are experiencing softer sales activity given recent interest rate hikes. This provides some reprieve from the unprecedented demand and unsustainable price increases we’ve seen across Canada through 2021 and in early 2022,” said Christopher Alexander, President at RE/MAX Canada. “However, the current lull in
the market is only temporary. Until housing supply increases, these ‘boom’ and ‘bust’ cycles will likely be
a recurring event.”
“Despite the fact that nearly half of Canadians are waiting to buy or sell a home, we’re confident that as economic conditions improve by mid-2023, activity will resume,” said Elton Ash, Executive Vice President, RE/MAX Canada. “Timing the market for short-term investment is extremely difficult and rarely successful. But real estate as a long-term investment continues to yield solid returns. If someone needs to engage in the housing market, regardless of those cyclical peaks and valleys, being informed and working with an experienced real estate professional can help consumers clarify some of those unknowns and make the best decision possible.”
In a survey of RE/MAX brokers and agents, 22 out of 30 said rising interest rates have affected activity in their local residential market this year, with some indicating that this has been the biggest factor impacting homebuyer and seller confidence – a trend that is likely to continue for the remainder of
2022. These insights are supported by a new Leger survey commissioned by RE/MAX Canada, which reveals that 44 per cent of Canadians agree that rising interest rates are compelling them to hold on buying a property this fall, while 34 per cent say they won’t hold.
The full report breaking down the markets can be found here.
(Mario Toneguzzi is a veteran of the media industry for more than 40 years and named in 2021 a Top Ten Business Journalist in the world and only Canadian)
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