Bad news if you are looking to break into the market or find an affordable place to live in Canada.
Our housing market is setting records and doesn’t look to be slowing any time soon, according to this report from RBC Economics and Robert Hogue, Macroeconomic and Regional Analysis Group member.
Housing prices are soaring, with the benchmark price in March up an astounding $120,000, or 20.1 percent, relative to a year ago, writes Hogue. This has not slowed demand, though.
“Home resales reached an all-time high of 833,100 units (seasonally adjusted and annualized) in Canada in March. This pace was more than 50 percent above the record 550,300 units set in all of 2020. Activity was at, or near a record high in most of British Columbia, Manitoba, Central Canada and Atlantic Canada.”
Additionally, the highest-ever number of sellers came to market, as new listings picked up for a second-straight month and climbed 7.5 percent month-over-month to a new record high of 1.0 million (seasonally adjusted and annualized) in Canada.
When will the market rebalance? It’s hard to know given that the supply increase is not nearly enough and demand itself must cool if prices are to moderate.
“A gradual rise in longer-term interest rates, deteriorating affordability and the resumption of office work will eventually restrain demand but it’s difficult to know when that will be,” says Hogue.
