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Canadians feeling the strain as weak sales persist

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It seems that the interest rate reality is finally catching up to the Canadian housing market, with very few positive data points to report when it comes to home sales in October 2023, as the Canadian Real Estate Association reports.

 

Sales up from 2022, down from September

 

Canadian home sales continued their steep decline, after a glimmer of hope as sales trended back up toward the 10-year moving average earlier this year.

Although up slightly (0.9 per cent) since last year, the number of homes sold in October fell 5.6 per cent below September sales:

 

Prices following suit

 

Much like sales volume, prices are in decline in the short-term (monthly) context, but up in the longer-term (yearly) context.

The House Price Index went down about 0.8 per cent, continuing the downward trend from the months prior, but up about 1.1 per cent since October 2022, showing that the market has not reached the severe lows we saw during last year’s selloff.

 

Still heading toward buyers’ market

 

Canada’s real estate market continued heading towards buyers’ market territory in October, with the sales-to-new listings ratio reaching a 10-year low at 49.5 per cent. Furthermore, there were 4.1 months of inventory nationally, up from the low of 3.1 months in May:

 

Financial stress on Canadians

 

New listings continued to outpace weakening sales. This is a likely indication that some financial stress has begun to impact households in Canada, and selling is the best option to relieve that stress.

 


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