Canada home sales pick up with buyers boosted by lower rates
Transactions were up 1.3 per cent in August from a month earlier
CANADA home sales climbed last month to the highest level since January as buyers benefited from lower borrowing costs.
Transactions were up 1.3 per cent in August from a month earlier, according to data released on Monday (Sep 16) by the Canadian Real Estate Association (Crea). More listings hit the market as well, pushing a benchmark measure of prices C$100 lower to C$717,400 (S$683,789).
The housing market had a bumpy summer season. Sales initially started to pick up in June as buyers got some relief from high borrowing costs, but slowed in July. While transactions rose in August, there are signs that the market is stuck in a “holding pattern,” according to Crea Senior Economist Shaun Cathcart.
New listings were up 1.1 per cent in August from a month earlier, and the total number of properties for sale at the end of August was 177,450, an increase of nearly 19 per cent from a year earlier.
Earlier this month, the Bank of Canada cut its benchmark interest rate for a third consecutive meeting, lowering it to 4.25 per cent. Policymakers said it’s “reasonable” to expect more easing, which could benefit potential homebuyers.
“With ever more friendly interest rates now all but guaranteed later this year and into 2025, it makes sense that prospective buyers might continue to hold off for improved affordability,” Cathcart said in the statement.
There are signs that parts of the Canadian economy are starting to slow, bolstering the case for the central bank to continue easing rates. The country’s jobless rate jumped more than expected in August. And a measure of inflation decelerated in July to the slowest pace in more than three years. BLOOMBERG
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