Residential Market Commentary - Autumn market slowdown

The Canadian Real Estate Association will be releasing its September Housing Market Stats along with its third quarter report and forecast in the coming days.  But another analyst is offering a preview. 

Well known housing economist Robert Hogue has released his thoughts on what to expect.  He sees more turbulence as the market moves through the autumn. 

“Confidence in the Canadian housing market came under renewed pressure in September as escalation in the trade war with the United States, and rising long-term interest rates put buyers on the defensive,” Hogue wrote in a recent report. 

Hogue notes that several local real estate boards recorded a drop in sales for September as well as a decline in home values.  New listings also posted an overall decline.  Vancouver posted an ongoing drop in sales with a 10% drop in new listings.  Toronto, which had been showing signs of a recovery, reversed course to record a nine percent drop in sales and a 14% drop in new listings.  Edmonton, Ottawa and Montreal reported price stabilization with gains in new listings, but declines in sales. 

Hogue sees these diverging trends as reflections of the different states of confidence across the country.  He sees that confidence being influenced by local factors such as affordability, pent-up demand, demographics, job markets and market inventory. 

Broadly speaking, Hogue is forecasting improving affordability and a resilient economy will help release pent-up demand, which could support a mild recovery.  But he cautions that, “the road ahead is likely to be bumpy and uneven across markets”.