The Hamilton Spectator

Home prices stop slipping lower, new report shows

February data finds cost of transactio­ns remained flat, boosting optimism

- CLARRIE FEINSTEIN TORONTO STAR

February ends a five-month streak of Canadian home price declines, indicating the country’s real estate sector will “pick up” ahead of the spring market as buyers and sellers waiting on the sidelines prepare to enter.

Canadian home prices were flat on a month-over-month basis in February, which is noteworthy given prices dropped by 1.3 per cent from December to January, according to a Monday report from the Canadian Real Estate Associatio­n (CREA).

“There have only been three other times in the last 20 years that have shared a sudden improvemen­t or increase in the month-over-month percentage change from one month to the next of this size,” the report said, “all at various points in the last four years when demand was coming off the sidelines.”

While home sales activity dipped by 3.1 per cent between January and February, the general trend shows that over the last three months there’s been higher levels of activity compared to last year’s quiet fall market.

Transactio­ns increased by almost 20 per cent last month over February 2023. Part of that sizable increase is due to the fact last February’s sales were one of the lowest for that month in two decades, but also current activity has climbed back to around five per cent below the 10year average.

“It’s looking like February may end up being the last relatively uneventful month of the year as far as the 2024 housing story goes,” said Shaun Cathcart, CREA’s senior economist. “With so much demand having piled up on the sidelines, the story will likely be less about the exact timing of interest rate cuts and more about how many homes come up for sale this year.”

New listings edged up 1.6 month over month with more gains expected in the coming months as owners prepare to list their properties for sale this spring, the report added.

“There’s a feeling that things are about to pick up,” said Larry Cerqua, chair of CREA, but it’s difficult to tell whether buyers are waiting for the Bank of Canada to cut rates or if they’re waiting for spring listings to hit the market.

In the GTA, home sales spiked by almost 18 per cent year over year, but dropped by almost 12 per cent from January to February.

The reason for the drop could be that people were waiting for the Bank of Canada’s rate announceme­nt at the end of January, experts say. Even so, there is a renewed sense of consumer confidence pointing to a rebound of stronger sales in 2024 compared to 2023, said Samantha Villiard, regional vice-president of Re/Max Canada.

In the GTA, the condo resale market is picking up after a “lacklustre” 2023, she said, which could stem from move-up buyers looking for bigger properties.

“The move-up buyer had a waitand-see approach,” she added, “waiting for the right time to reenter the market. Now could be that time for people as the Bank of Canada continues to hold its rate.”

Real estate agents are also saying there are many homes attracting multiples offers and well-priced properties are selling over asking, Villiard said.

“This environmen­t could bring more sellers to market and help fix the inventory shortage we’ve been seeing.”

 ?? NICK LACHANCE TORONTO STAR ?? Homebuyers and sellers are expected to come off the sidelines, with price declines already stalling ahead of the spring market.
NICK LACHANCE TORONTO STAR Homebuyers and sellers are expected to come off the sidelines, with price declines already stalling ahead of the spring market.

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