Canada’s housing market closed out 2023 with a bang
Canadian home sales saw an “unexpected surge” in December as sellers and buyers came together to get deals done before the new year, according to the national real estate body.
The Canadian Real Estate Association (CREA) said Monday that December saw an 8.7 per cent jump from November in the number of homes sold. That put the final month of the year on par with some of the “relatively stronger” spring and summer months, CREA said.
CREA senior economist Shaun Cathcart said in a statement that it’s unlikely the surprisingly strong December was a sign of a housing market rebound kicking off.
“It was more likely just some of the sellers and buyers that were holding onto unrealistic pricing expectations last fall finally coming together to get deals done before the end of the year,” he said.
“We’re still forecasting a recovery in housing demand in 2024, but we’ll have to wait a few more months to get a sense of what that ultimately looks like.”
BMO chief economist Doug Porter pointed to unseasonably warm weather and a “sudden pullback” in long-term borrowing costs as likely factors behind the December bump.
Declining bond yields, tied to expectations for rate cuts from the Bank of Canada in 2024, havepushed down some fixed mortgage rates by more than a percentage point from recent peaks seen in late October.
There were few people listing their homes in the traditionally slow December, CREA said, pushing the sales-to-new listings ratio back up to 57.8 per cent from just over 50 per cent in November. This key metric helps to gauge whether markets favour buyers or sellers, with CREA putting the long-term average of around 55 per cent.
The volume of home sales were up 3.7 per cent year-over-year in December.
Looking back at the
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