Sellers are coming back to Canada’s housing market. Will prices stabilize?
Global News
Canada's housing market saw an 'influx' of sellers in May, according to RBC, but demand from buyers is still putting upward pressure on prices.
An “influx” of sellers added new listings to Canada’s tight housing supply in May, but it might not yet be enough to balance a market full of buyers, according to Royal Bank of Canada (RBC).
In a report released Tuesday, RBC assistant chief economist Robert Hogue analyzed early reports from local real estate boards reporting May figures, which he said “unanimously show a material rise in new listings.”
Sellers rushed back to Calgary’s market in May, according to RBC, with seasonally adjusted new listings up 27 per cent month-over-month and home resales rising more than six per cent.
In Toronto, RBC’s analysis shows a 17 per cent jump in new listings month-to-month on a seasonally adjusted basis. In Vancouver, new listings were up 15 per cent month-over-month.
Canada’s spring housing market has shown signs of life in recent months after a sharp cooling tied to higher interest rates. But the Canadian Real Estate Association (CREA) said demand from buyers coming off the sidelines in April was “vastly outpacing” supply from sellers in the resale market.
The sales-to-new-listings ratio jumped up to 70.2 per cent in April, compared with 64.1 per cent in March and the long-term average of 55.1 per cent.
The tight supply means buyers have been competing over a limited number of properties, in turn fuelling a rise in prices.
Hogue wrote that the apparent return of sellers is “good news” for buyers, but he warned the listings seen in May “made only a small dent” in the dearth of supply observed in most markets.