Tracey Appleton’s Post

At the start of 2024, many experts predicted the Bank of Canada would lower interest rates from 5% to around 3.5%-4% by year-end. Consumers shared similar hopes according to early-year surveys. What actually happened? Rates dropped multiple times! The overnight rate is now 3.75%, with one more BoC meeting still to come. This has sparked a shift, with many homeowners opting for variable-rate mortgages as borrowing becomes more affordable. Curious about how these changes have shaped the market so far? Check out the 2024 housing market recap to see how predictions held up against reality! #successstories #digitaltransformation

On the heels of the Bank of Canada’s key lending rate remaining unchanged at 5.0% for the third consecutive quarter, pent-up demand exacerbated by rising borrowing costs since March 2022, continues to accumulate in Quebec’s real estate market, as buyers try to get their hands on a property. While supply is increasing, it remains insufficient. According to the results of the Royal LePage® Home Price Survey and Market Forecast released today, the first quarter of 2024 proved to be more active than expected in the Greater Montreal real estate market, and across Quebec, as spring temperatures and the expectation of an upcoming interest rate cut prompted buyers to accelerate their property searches.

2025 Housing and Interest Rate Forecasts Heading into 2025, Canada’s housing market is expected to see growth as interest rates trend downward. Key predictions include: Home Sales: CREA forecasts a 6.6% rise, with sales reaching nearly 500,000 units. Home Prices: Royal LePage expects a 6% increase, pushing the average price to $856,692 by Q4 2025. Interest Rates: Major banks predict the Bank of Canada’s overnight rate could fall to 2.00% by year-end, reducing borrowing costs. While rate cuts may provide relief, high prices and affordability challenges remain.

Canadian Housing Market Was Quiet In May - a bit of a sleepy month! The Canadian Real Estate Association (CREA) announced yesterday that national home sales fell 0.6% in May, remaining slightly below the average of the past ten years. Actual (not seasonally adjusted) monthly activity was 5.9% below May 2023. With the Bank of Canada rate cut on June 5, housing activity will likely perk up in the coming months. The central bank will likely reduce the overnight policy rate from 4.75% to 3.0% by the end of next year. While interest rates will remain above pre-pandemic levels, there is pent-up demand for housing, and activity will surely rise over the next year. Read more from our Chief Economist at: https://lnkd.in/gKJbh5-v

October saw Canadian home sales hit a two-year high, revealing a robust response to the Bank of Canada’s strategic interest rate reductions. Reporting a 7.7% increase in transactions since September, this uptick showcases a revived market buoyed by improved purchasing power and renewed buyer confidence. The key factor behind this surge was the Bank’s largest rate cut since March 2020. Lower borrowing costs have not only made homes more accessible but have also revitalized the buyer-seller dynamics. Concurrently, the market has tightened: new listings decreased by 3.5%, and inventory shrank to just 3.7 months – clear signs of a more competitive landscape. Despite these shifts, home prices have remained remarkably stable, with the benchmark price nudging slightly to $716,800. Looking ahead, further rate cuts and adjustments to insured mortgage rules could continue to stimulate demand, although challenges around affordability, especially in metropolitan areas like Toronto and Vancouver, remain persistent hurdles. As industry professionals, we must consider the long-term implications of these trends. How sustainable is this growth amid economic uncertainties? What strategies should real estate professionals prioritize to navigate this evolving market effectively? I invite insights, experiences, and predictions from fellow experts on continuing this momentum and addressing the ongoing affordability crisis. Let’s discuss how we can adapt to and thrive in this changing landscape. #CanadianRealEstate #HousingMarket #InterestRates #RealEstateTrends #ProfessionalNetworking Connect, engage, and share your views on where we're headed and how we can collectively influence the future of Canadian real estate.

The Canadian real estate market showed further signs of sluggishness in May, with the national benchmark home price slipping to $714,300, down 0.2 per cent from April to May 2024, and 2.4 per cent year over year. Despite this, the Canadian Real Estate Association (CREA) remains optimistic, expecting the recent rate cut by the Bank of Canada to inject new life into the market. “May was another sleepy month for housing activity in Canada, although it may prove to be the last of those now that interest rates have moved lower,” CREA’s senior economist Shaun Cathcart said in Monday’s report. Cathcart believes the central bank’s rate cut to 4.75 per cent on June 5 will have a significant psychological impact on potential buyers. #Canada #real #estate #market #showed #further #signs #of #revitalization #after #cut #rate

As the calendar flipped one year ago, Canadian real estate watchers were optimistic a sluggish 2023 would give way to a rebound, with hopes of renewed demand as soon as the spring. But the lag in 2024 lasted longer than some expected, with the Bank of Canada waiting until June to deliver the first of the year’s five interest rate cuts. While buyers stormed back to the market this fall, experts noted the first few rate cuts hadn’t been enough to motivate everyone to leave the sidelines quite yet. Now heading into 2025, economists and real estate agents believe activity is poised to remain strong amid much lower borrowing costs and more favourable rules for buyers, despite an overall challenging affordability picture.

Financial Post 'Ho-hum' national housing figures in September sign that buyers want more rate cuts National home sales increased marginally in September, following the Bank of Canada’s third interest rate cut of the year. This marked the third consecutive month of gains, as lower borrowing costs provided some added incentive for buyers. However, sales continued to be outpaced by new listings, leading to a surplus of properties on the market.

The article discusses BMO's prediction that Canada's real estate stagnation has only just begun, despite recent interest rate cuts and some increase in sales. While home prices have seen minimal change, they remain too high for many buyers, limiting demand. The anticipated rapid recovery, which has been predicted for the last few years, is unlikely, with affordability issues continuing to impact the market. Even with interest rates falling, fixed-rate mortgages remain too expensive to drive significant growth in sales or prices. BMO's report highlights that while the Bank of Canada’s rate cuts have impacted variable rates, they haven’t sufficiently reduced the cost of home ownership for many buyers. This, combined with high home prices, means the market is expected to remain flat or stagnant in 2025. Even with some improvements in certain regional markets, Toronto, as the largest and most expensive, sets the overall tone for the Canadian market, which shows little sign of a strong rebound. Overall, the market’s lack of movement can be attributed to a combination of high prices, limited credit capacity, and a general reluctance from sellers to accept lower valuations. The article suggests that Canadians should not expect a "trampoline-like rebound" in the near future, with regional variances adding to the complexity of the national real estate situation.

Jamie Squires, as the President and Managing Broker of Fifth Avenue Real Estate Marketing Ltd., shares her insights on how this development will impact our industry and what it means and what potential outcomes this change could have on our real estate markets. https://lnkd.in/gQf_g3aR On June 5th, 2024, the Bank of Canada announced a surprising but welcome interest rate cut of 25 basis points, reducing its target for the overnight rate to 4 ¾, with the Bank rate at 5%. "The decision to lower interest rates is a strategic move by the Bank of Canada to stimulate economic growth and encourage borrowing. This reduction carries significant implications for the real estate market, particularly in terms of affordability and market activity." #realestate #interestrates #fifthavenuerem #fifthsales