Housing market tightens after fourth-straight monthly drop in sales - Financial Post

Prices rose 0.3 per cent to around $669,200

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Bloomberg News

Ari Altstedter

A home for sale in Toronto. Canada's housing market has been steadily cooling since reaching a peak in March. Photo by Carlos Osorio/Reuters files

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Canada’s housing market posted its fourth month of sales declines as the number of people looking to sell their homes saw a precipitous decline despite prices near record levels.

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Transactions fell 3.5 per cent in July, with new listings dropping 8.8 per cent, according to data released Monday from the Canadian Real Estate Association. That caused the national average home price to rise 0.3 per cent to around $669,200 (US$532,600), while the ratio of sales to new listings, a measure of market tightness, rose to 74 per cent from 70 per cent the previous month.

The problem of high housing demand amid low supply has not gone anywhere — it's arguably worse

Shaun Cathcart

Since the pandemic caused a buying frenzy in Canada that sent sales and prices to record heights in March, the market has been steadily cooling off as prospective buyers contend with a dearth of new houses for sale. Though increasing vaccination rates have begun to bring a return to normal life in Canada, that’s left the country to contend with one of the developed world’s most severe housing shortages and little prospect of much new supply becoming available soon.

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1. 

   Toronto home sales fall to lowest in a year, but prices still rising

2. 

   Cooler housing market won’t hurt Canada’s recovery: CIBC

3. 

   Condos are getting hot again in Canada’s biggest cities as rental demand surges

4. 

   Toronto condo rents rise for first time in 18 months as impact of pandemic recedes

“We are not returning to normal, we are only returning to where we were before COVID, which was a far cry from normal,” Shaun Cathcart, the national real estate board’s senior economist, said in a press release accompanying the data. “The problem of high housing demand amid low supply has not gone anywhere — it’s arguably worse.”

The decline in listings was seen across Canada’s major cities, including Toronto, Montreal and Vancouver, with new supply down in about three quarters of the country’s markets, the data show. But despite this tightening, and the resulting drop in activity from the previous month, July home sales were still well above the average from the last 10 years.

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Housing market tightens after fourth-straight monthly drop in sales - Financial Post
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