Cooling home sales push some owners to list their units in hot rental markets

A cooling ownership market is pushing some homeowners to put a sale on hold and put their home on the rental market, according to new real estate data.

When Shannon Tebb listed her downtown Toronto loft for sale in mid-June, she did everything to make the property attractive for buyers. She hired stagers, painted walls, washed the windows, listed the place below market value and advertised all over social media.

But by July, she was pulling the property off the market — and not because she’d found a seller.

Tebb terminated the listing because the market shifted so significantly that the bidding wars and frenzied pace of sales seen earlier this year had dissipated.

Last month, the Canadian Real Estate Association (CREA) reported June home sales amounted to 48,176, a 24 per cent drop from 63,280 during the same month last year. On a seasonally adjusted basis, sales were down almost six per cent from May.

The fall has been attributed to interest rates, which are rising at a faster pace than some anticipated and pushing up the cost of a mortgage, and inflation, which recently hit a 39-year high.

Both have made it routine for properties to sit for weeks or months, pushing sellers to make tough decisions.

Since she wasn’t getting much interest on her listing, Tebb terminated it and turned the loft into a rental property instead.

“Everyone was saying, ‘nobody’s going and looking at anything,’ so then we lowered the price…and we had a few walk-ins but nothing, no offers.”