The real estate housing market in Canada is showing positive signs once more. A recent poll by Nanos Research for Bloomberg News shows that nearly half of Canadians, 48%, anticipate an increase in the value of the real estate in their neighborhoods. This projected increase in the real estate market in Canada is supposed to take place over the next six months.
Only 8% predict a decline in the real estate housing market in Canada, while the rest are expecting no change or are uncertain. This 40-point difference is the widest since May 2022, which was just two months after the Bank of Canada started raising interest rates.
Real Estate Housing Market in Canada
The recent reading on property prices of the real estate housing market in Canada, excluding the growth from 2020 to 2022 during the pandemic, marks the highest level since the Bloomberg Nanos Canadian Confidence Index began in 2008.
Bank of Canada officials hinted last week that they might soon start lowering the overnight interest rate if inflation indicators continue to improve. Many potential homebuyers in the real estate housing market in Canada have been holding off for lower borrowing costs. Moreover, the country’s fast-growing population has added demand in the real estate market in Canada.
Robert Kavcic, senior economist at the Bank of Montreal talking about the real estate housing market in Canada, said that if the BoC does not cut rates, then the real estate market in Canada will be disappointed.
Canada Real Estate Market Forecast
Talking about the Canada Real Estate Market Forecast, the Bank of Canada is looking forward to moderate growth in house prices over the next two years. However, officials said that the potential for a major increase is one of the main upward risks to their inflation projection.
Nanos Research surveys approximately 250 Canadians weekly to understand their opinions on personal finances, job security, the economy, and real estate prices. Bloomberg releases four-week rolling averages based on the 1,000 telephone responses. The poll has a margin of error of about 3 percentage points, 19 times out of 20.
The sales of homes in British Columbia decreased by almost 10% in March compared to the same period last year, showing a possibility of a slowdown in the real estate market in Canada. This possibility of a slowdown in the real estate housing market in Canada could be why buyers are waiting for lower interest rates.
According to the B.C. Real Estate Association, the province recorded 6,460 residential unit sales in the Multiple Listing Service systems last month, marking a 9.5% decrease from March 2023. The total dollar volume of home sales also decreased by 3.6% from the same month last year, falling to $6.6 billion.
Chief economist Brendon Ogmundson of the association said that potential homebuyers seem to be holding off, possibly in anticipation of the Bank of Canada lowering its policy rate.
Ogmundson also said that March’s decrease concludes a “slow start” to the first quarter of 2024, despite a significant drop in fixed mortgage rates. The association reported that the average price of a home in B.C. on MLS did increase by 6.5% from last March, reaching $1.02 million.
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