Here's What Experts Have to Say About the Fall Real Estate Market in Canada
Leaves are not the only thing falling as we enter the autumn season. So are home prices. In fact, home prices have been slowly declining since February. Please remember as you read, that this post is about the NATIONAL real estate market. We’d love to talk with you about your very specific place in the North Okanagan real estate market!
This slow transition means that if you’re in the market to sell your home, it’s still a good time — the fall real estate market remains fairly strong.
In this post, we’ll go over upcoming real estate market predictions from top experts in the industry.
Home Sales Slow Down
August marked Canada’s slowest resale activity in three and a half years. August’s sales dropped to 443,000 units – a 1% decrease from July. This continues the downward trend we’ve seen over the past six months. Yet, 1% is the smallest month-over-month decline recorded since February. According to Jill Oudil, Chair of the Canadian Real Estate Association (CREA), “this year’s sharp adjustment in housing markets across Canada may have mostly run its course”.
Prices Are Falling, But Not Crashing
Rising interest rates are causing home prices to fall as buyers stretch their budgets. Experts anticipate that prices will ease by 2.2% this fall. But, despite the price decreases in markets across the country, property values are still higher than they were a year ago, almost everywhere.
The Bank of Canada is poised to continue raising interest rates until the end of the year, so if you’re flirting with the idea of selling your home, now could be the time to take advantage of the real estate market. Canadians seem to have mixed sentiments about home buying and selling this fall. Some are waiting to see how rising interest rates will affect the market, while others are jumping in.
As some buyers hold off and the housing shortage we saw during the pandemic and shortly after eases, we’re seeing more inventory, and it’s sitting for longer. However, experts suggest that this ease is only temporary. Many Canadians are still waiting to buy or sell a home, and conditions are expected to pick up by mid-2023. For now, buyers in some markets have the luxury of choice – and the time to make it.
Rising Interest Rates
As we mentioned, interest rates are on the rise and will likely continue to rise as the Bank of Canada attempts to combat inflation. As of September 2022, the average rate for a 5-year fixed mortgage is 5.3%, a significant increase from the mid-pandemic lows.
Time on Market is Climbing
Like its diverse landscapes and people, Canada’s real estate markets vary greatly from coast to coast. In the GTA, properties spent an average of 34 days on the market in August, compared to 11 in February. But in markets such as Calgary, homes are selling quickly as supply-demand conditions remain tight.
Just because you may not accept an offer within four hours of listing your home (which can still happen) does not mean your home won’t sell this fall. The more expensive a home is, the longer it stays on the market, so if you have a moderately priced home to sell this fall, you should have nothing to worry about. Even if you’re looking to list a multi-million-dollar home, remember, the market is still strong; homes are just not being sold overnight for the most part — but with an effective real estate agent who understands the local market, anything can happen!