Inflation and elevated borrowing costs have taken their toll on affordability. This has been no more apparent than in the interest-rate-sensitive housing market. However, it does appear relief is on the horizon. Bond yields, which underpin fixed-rate mortgages have been trending lower and an increasing number of forecasters are anticipating Bank of Canada rate cuts in the first half of 2024. Lower rates will help alleviate affordability issues for existing homeowners and those looking to enter the market.
Ontario Elevated Borrowing Costs Taking a Toll on Housing Affordability
Toronto, 04 December 2023, High borrowing costs and uncertain economic conditions continued to weigh on Greater Toronto Area (GTA) home sales in November 2023. Sales were down on a year-over-year basis, while listings were up from last year’s trough in supply. With more choice in the market, selling prices remained flat year-over-year.
“Inflation and elevated borrowing costs have taken their toll on affordability. This has been no more apparent than in the interest-rate-sensitive housing market. However, it does appear relief is on the horizon. Bond yields, which underpin fixed-rate mortgages have been trending lower and an increasing number of forecasters are anticipating Bank of Canada rate cuts in the first half of 2024. Lower rates will help alleviate affordability issues for existing homeowners and those looking to enter the market,” said Toronto Regional Real Estate Board (TRREB) President Paul Baron.
GTA REALTORS® reported 4,236 sales through TRREB’s MLS® System in November 2023 – a 6% decline compared to November 2022. Over the same period, the number of new listings was up by 16.5%. On a seasonally adjusted monthly basis, sales edged up compared to October 2023, while new listings were down by 5.5%.
The MLS® Home Price Index Composite benchmark and the average selling price, at $1,082,179, in November 2023 were basically flat in comparison to November 2022. On a seasonally adjusted monthly basis, the MLS® HPI Composite benchmark was down by 1.7%. The average selling price was down 2.2% month-over-month.
“Home prices have adjusted from their peak in response to higher borrowing costs. This has provided some relief for buyers, from an affordability perspective. As mortgage rates trend lower next year and the population continues to grow at a record pace, expect demand to increase relative to supply. This will eventually lead to renewed growth in home prices,” said TRREB Chief Market Analyst Jason Mercer.
“Houses and condos are meant to be homes, first and foremost. We know the demand for homes, both rental and ownership, will grow for years to come. We have seen some productive policy decisions recently that should help with housing affordability, including allowing existing insured mortgage holders to switch lenders without the stress test. Additionally, in the interest of household and economic stability, we continue to call on the Office of the Superintendent of Financial Institutions (OSFI) to apply the same approach to uninsured mortgages. It also goes without saying that further policy work is required to bring more supply online,” said TRREB CEO John DiMichele.
Ottawa MLS® Home Sales Stable in November Amid Growing Supply
Ottawa, December 5, 2023 --The number of homes sold through the MLS® System of the Ottawa Real Estate Board totaled 724 units in November 2023. This was a small reduction of 1.6% from November 2022.
Home sales were 31.8% below the five-year average and 27.4% below the 10-year average for the month of November.
On a year-to-date basis, home sales totaled 11,421 units after 11 months of the year. This was a decline of 11.7% from the same period in 2022.
“Sales are performing as expected with the arrival of colder months, and an uptick in new and active listings is bringing more choice back into the market,” says OREB President Ken Dekker. “While more choice may mean the pace of buying and selling has slowed, that doesn’t mean people looking to enter or upgrade in the market should sit back. Prospective buyers or those looking to upgrade have an opportunity to collaborate with their REALTOR® to carefully explore the market, identify the ideal property, and negotiate an attractive deal at their own pace. Sellers will have to manage their expectations regarding the quantity of offers and speed of transactions, and their REALTOR® is the best resource to help them confidently price and prepare their home for a quality sale.”
The MLS® Home Price Index (HPI) tracks price trends far more accurately than is possible using average or median price measures.
The overall MLS® HPI composite benchmark price was $628,900 in November 2023, nearly unchanged, up only 1.4% from November 2022.
The benchmark price for single-family homes was $708,900, up 1.6% on a year-over-year.
By comparison, the benchmark price for a townhouse was $492,300, nearly unchanged, up 0.8% compared to a year earlier.
The benchmark apartment price was $424,300, up 1.2% from year-ago levels.
The average price of homes sold in November 2023 was $633,138, decreasing 0.8% from November 2022. The more comprehensive year-to-date average price was $669,536, a decline of 5.7% from 11 months of 2022.
The dollar value of all home sales in November 2023 was $458.4 million, down 2.4% from the same month in 2022.
OREB cautions that the average sale price can be useful in establishing trends over time but should not be used as an indicator that specific properties have increased or decreased in value. The calculation of the average sale price is based on the total dollar volume of all properties sold. Price will vary from neighbourhood to neighbourhood.
The number of new listings saw an increase of 2.7% from November 2022. There were 1,428 new residential listings in November 2023. New listings were 8.4% above the five-year average and 10.4% above the 10-year average for the month of November.
Active residential listings numbered 2,752 units on the market at the end of November, a sizable gain of 15.8% from the end of November 2022.
Active listings were 53.9% above the five-year average and 6.7% below the 10-year average for the month of November. Active listings haven’t been this high in the month of November in more than five years.
Months of inventory numbered 3.8 at the end of November 2023, up from the 3.2 months recorded at the end of November 2022 and above the long-run average of 3.3 months for this time of year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.
British Columbia - Balanced conditions come to the Metro Vancouver housing market for the holiday season
Metro Vancouver, November 15, 2023 -- With one month left in 2023, a steady increase in housing inventory is offering home buyers across Metro Vancouver among the largest selection to choose from since 2021.
The Real Estate Board of Greater Vancouver (REBGV) reports that residential sales in the region totalled 1,702 in November 2023, a 4.7% increase from the 1,625 sales recorded in November 2022. This was 33% below the 10-year seasonal average (2,538).
"We’ve been watching the number of active listings in our market increase over the past few months, which is giving buyers more to choose from than they’ve been used to seeing over the past few years. When paired with the seasonal slowdown in sales we typically see this time of year, this increase in supply is creating balanced conditions across Metro Vancouver’s housing market." Andrew Lis, REBGV director of economics and data analytics
There were 3,369 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in November 2023. This represents a 9.8% increase compared to the 3,069 properties listed in November 2022. This was 2.8% below the 10-year seasonal average (3,464).
The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 10,931, a 13.5% increase compared to November 2022 (9,633). This is 3.7% above the 10-year seasonal average (10,543).
Across all detached, attached and apartment property types, the sales-to-active listings ratio for November 2023 is 16.3%. By property type, the ratio is 12.7% for detached homes, 19.8% for attached, and 18.2% for apartments.
Analysis of the historical data suggests downward pressure on home prices occurs when the ratio dips below 12% for a sustained period, while home prices often experience upward pressure when it surpasses 20% over several months.
“Balanced market conditions typically come with flatter price trends, and that’s what we’ve seen in the market since the summer months. These trends follow a period where prices rose over seven% earlier in the year,” Lis said.
“You probably won’t find Cyber Monday discounts, but prices have edged lower by a few% since the summer. And with most economists expecting mortgage rates to fall modestly in 2024, market conditions for buyers are arguably the most favorable we’ve seen in some time in our market.”
Sales-to-active listings ratio - November 2023
Detached 12.7 %
Attached 19.8 %
Apartment 18.2 %
Total 16.3 %
The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,185,100. This represents a 4.9% increase over November 2022 and a 1% decrease compared to October 2023.
Sales of detached homes in November 2023 reached 523, a 7% increase from the 489 detached sales recorded in November 2022. The benchmark price for a detached home is $1,982,600. This represents a 6.8% increase from November 2022 and a 0.9% decrease compared to October 2023.
Sales of apartment homes reached 850 in November 2023, a 0.4% increase compared to the 847 sales in November 2022. The benchmark price of an apartment home is $762,700. This represents a 6.2% increase from November 2022 and a 1% decrease compared to October 2023.
Attached home sales in November 2023 totalled 316, a 12.5% increase compared to the 281 sales in November 2022. The benchmark price of a townhouses is $1,092,600. This represents a 6.9% increase from November 2022 and a 0.7% decrease compared to October 2023.
Alberta - Increased listings, strong sales, and price growth
Calgary, Dec. 1, 2023 – New listings in November reached 2,227 units, nearly 40% higher than the exceptionally low levels reported last year at this time. Gains in new listings occurred across most price ranges, but the most significant gains occurred from homes priced over $600,000.
Despite the year-over-year jump in new listings, inventory levels remained low thanks to relatively strong sales. With 1,787 sales in November, the sales to new listings ratio remained high at 80%, and the months of supply remained below two months.
“Like other large cities, new listings have been increasing,” said CREB® Chief Economist Ann-Marie Lurie. “However, in Calgary, the gains have not been enough to change the low inventory situation thanks to strong demand. Our market continues to favour the seller, driving further price growth.”
As of November, the benchmark price was $572,700, up over last month and nearly 11% higher than November 2022. Year-to-date, the average benchmark price has risen by over five%.
City of Calgary November Housing Stats
Detached - Limited supply choice for homes priced below $700,000 has been the primary cause of the decline in detached home sales. While November reported a marginal gain over last year, year-to-date sales have declined by 20%. November saw a rise in new listings compared to the previous year, but higher-priced homes drove most gains. This has left the detached market with exceptionally tight conditions for prices below $700,000 and more balanced conditions for higher-priced homes. Overall, the month of supply remains exceptionally low at under two months.
Persistently tight conditions continue to cause further price gains in the detached market. As of November, the unadjusted benchmark price reached $699,500, a slight increase over last month and over 13% higher than last November. While detached home prices are much higher than last year's levels in every district, year-to-date gains are the highest in the most affordable districts of the North East and East.
Semi-Detached - November saw a boost in new listings compared to last year, helping to prevent a year-over-year decline in inventory levels. However, inventory levels are still over 40% below typical levels seen in November. With a sales-to-new-listings ratio of 77% and a month-of-supply below two months, conditions remain exceptionally tight, especially for homes priced below $700,000.
Despite tight conditions, benchmark prices remained stable compared to last month. However, at an unadjusted benchmark price of $628,700, prices are still over 12% higher than last year. The year-to-date average benchmark price has risen by nearly seven%, with the largest gains occurring in the North East and East districts.
Row - New listings rose again this month compared to last year. The 370 new listings were met with 267 sales, and for the first time since 2021, the sales-to-new-listings ratio fell below 75%. The jump in new listings was enough to support a gain in inventory levels compared to last month and last year. While inventories are still nearly half the levels we traditionally see, this did help cause the months of supply to push up to 1.6 months, a significant improvement from the less than one month of supply that has persisted over the past seven months. While conditions are much more balanced in the higher price ranges, there is less than one month of supply for homes priced below $500,000.
Despite the shift away from exceptionally tight conditions, prices still rose over the last month and last year. As of November, the unadjusted benchmark price reached $429,100, 21% higher than last November and an average year-to-date gain of nearly 13%.
Apartment Condominium - Thanks to the relative affordability of the apartment-style homes, sales continued to reach record highs in November, contributing to year-to-date sales of 7,487. With one month left in the year, sales have already surpassed last year’s record high. This, in part, was possible thanks to the growth in new listings. While inventory levels are similar to levels reported last year, with less than two months of supply, conditions still favour the seller, placing further upward pressure on prices.
The unadjusted November benchmark price reached $320,100 in November, a monthly gain of over one% and a year-over-year increase of 18%. Year-to-date price gains have occurred across every district in the city, with some of the largest gains arising in the lower-priced North East and East districts.
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