Harbourwalk condos.The number of newly listed houses in Canada plummeted 14.5%. According to the monthly report released today by the Canadian Real Estate Association, the number of homes sold in January 2018 was 14.5% lower than in December last year, the lowest in three years.Please Visit: Harbourwalk condos to Get Your VVIP Registration Today!
According to the monthly report, on an annual basis, national housing sales fell 2.4% in January compared with the same period last year. In fact, home sales in the local real estate market have declined over the past three quarters, including several of the largest real estate markets in the country.
The monthly analysis said that it is obvious that the implementation of stricter new federal mortgage rules from January this year will have a great impact on these two-month transactions, as many buyers want to make housing transactions before the new rules.
According to CREA’s monthly report, the biggest decline in home sales in January was in the Golden Horseshoe area of Ontario (Greater Golden Horseshoe), with Toronto falling 26.6%, almost offsetting sales growth in the last three months of last year. Sales in Vancouver also fell 10.5% in January. On the contrary, B. C. Sales rose in the lowland plains, Vancouver Island, Montreal, Edmonton, Okanagan Region, Greater Moncton and Halifax-Dartmouth.
Robert Kavcic, a senior economist at BMO, said in a note that it was not surprising that sales fell in Toronto and Vancouver in January because the two markets were similar, with both sales and prices falling, while the Condo/ apartment market was still hot.
CREA Chairman Andrew Peck wrote in a statement that the new mortgage rules implemented since the New year, coupled with the continued shortage of housing, have caused unease and concern among potential buyers. If the government does not try to solve the supply-side problems, it will be difficult to allay the concerns of buyers. The sharp drop in the volume of newly listed houses has returned to the seller’s market.
According to data released by CREA’s monthly report, the number of new homes listed on the market plunged 21.6% in January, the lowest level since the spring of 2009.
More overseas house price information monthly report also said that due to the sharp decline in the supply of new homes in the Greater Toronto area, the supply of new homes dragging down all local markets fell by about 85%. As the decline in the number of newly listed homes was significantly greater than the decline in home sales, the ratio of home sales to listings rose to 63.6 per cent last month, while it has not exceeded 60 per cent since May last year, fluctuating between 55 and 59 per cent.
According to the theory of the real estate market, if the ratio of housing sales to listing last month is more than 60%, it belongs to the seller’s market, 40% to 60% belongs to the balanced market, and less than 40% belongs to the buyer’s market.
Although the ratio of SNL in each market is high or low in January, overall, the Canadian housing market is still a seller’s market. Gregory Klump, chief economist of CREA, said the slump in home sales in January was buyers’ response to changes in government policy, as rational buyers tried to buy homes before the new rules were implemented.
At the same time, the sharp decline in the number of newly listed houses is not good for buyers, nor is it conducive to the shift of the real estate market to a balanced market.
Although the Canadian housing market will make a soft landing, industry experts still expect a soft landing for the Canadian housing market.
For example, Michael Dolega, an economist at TD Bank, said that for the Canadian housing market, there are both pros and cons: favorable factors include a good economic situation in Canada, a strong job market, not to mention long-term support for the Canadian real estate market, at least in the medium term.
However, the downside is also clear that stricter new mortgage rules, rising mortgage rates and a shortage of housing supply will have an impact on home sales and house prices. All in all, the recent weakness does not affect a soft landing in the Canadian real estate market. Home sales are expected to fall this year and prices are flat, but the situation will improve significantly sometime in 2019.