Buyers take ‘upper hand’ in some of Canada’s most expensive housing markets

globalnews.ca:

Royal Bank of Canada report.The RBC analysis of the October resale market argues higher interest rates have the fall housing market “stuck in a low gear.”Inventories are still growing, but not at the pace seen for the past few months in Toronto, Vancouver and the Fraser Valley. Buyers are still finding they have more options to choose from, leading to a “rebalancing of market conditions.”Those buyers who are able to qualify for a mortgage amid higher interest rates have been able to extract lower prices in some Ontario, Quebec and British Columbian markets, according to the report from RBC’s Robert Hogue and Rachel Battaglia.Toronto, Montreal, Vancouver and the Fraser Valley all saw price declines month-to-month in October.Toronto’s October was the quietest in nearly 25 years, the report said, with buyers taking the “upper hand” in negotiations.

But the rapid increase in interest rates means many prospective homebuyers are struggling to secure mortgages and are facing high ownership costs if they can qualify.“Buyers are poised to maintain their strong bargaining position while their budget remains heavily constrained by high interest rates and extremely poor affordability conditions,” the report notes.Vancouver, too, is in “full-blown cooling mode” with residential sales now below levels seen this time last year. “Tepid demand” from homebuyers and expectations that sellers will continue to list in the market will “tip the scale in favour of buyers and sustain the softening in prices in the months ahead,” the report argues.Calgary continues to see home values climb, though the market “began to show cracks,” the report argues.The city remains “Canada’s hottest market,” the authors note, but the advantages Calgary had tied