First National Financial LP

Residential Mortgage Commentary - Spring buying season sprouts slowly

  • First National Financial LP

The spring home-buying season is off to a soft start.  The latest figures from the Canadian Real Estate Association show both sales and prices dipped, while inventories rose in April.

The numbers suggest a move toward better stability in Canada’s notoriously unhinged real estate market, and a move away from seller dominance.

April sales slipped 1.7% compared to March, but sales are up 10% compared to April 2023.  The national average price of a home remained flat month-over-month, but is down 1.8% compared to a year earlier, at about $703,500.

This comes as the number of new listings rose 2.8% m/m.  CREA notes that, when the rise in new listings is combined with slower sales it amounts to a 6.5% increase in the number of properties on the market.

The national sales-to-new listings ratio eased to 53.4%. The long-term average is 55%.  A ratio between 45% and 65% is generally considered balanced.

Affordability in Canada’s real estate market remains a key concern.  Many market watchers believe anxious buyers are thinking about the longer term, and waiting for interest rates to start falling before making their purchase.

In the meantime, those who can afford to get into the market have a larger range of home choices and renewed opportunities to negotiate terms.