Home sales fell 12.6% nationally in April 2022, compared to the previous month, bringing monthly sales to their lowest level since the summer of 2020.
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According to statistics from the Canadian Real Estate Association (CREA), the national decline is mainly attributable to the Greater Toronto Area, but also to 80% of the local markets where a decrease is observed.
Montreal is one of the exceptions in Canada, like Victoria and Halifax-Dartmouth, where sales increased slightly.
The number of actual transactions (unadjusted for seasonality) in April 2022 was down 25.7% from the record for that month set last year. However, as seen since last summer, April sales still rank third in April sales on record, behind those of 2021 and 2016.
In April, the real average price (not seasonally adjusted) of properties sold in the country was just over $746,000, an increase of 7.4%.
The national average price is heavily influenced by sales in Greater Vancouver and Greater Toronto, two of the busiest and most expensive markets in Canada. If these two markets are excluded from the April 2022 calculation, the national average price drops by approximately $138,000.
“After about two years of record results, housing markets in many parts of Canada have slowed quite sharply over the past two months, in line with rising borrowing costs as well as buyer fatigue” , said Jill Oudil, president of the ACI, in a press release Monday.
This slowdown could finally give buyers more time to consider options in the market.
According to Shaun Cathcart, senior economist at ACI, the market is reacting strongly now because the usual low five-year mortgage rates have risen, in one month, from 3 to 4%.
For fixed rate borrowers, it has just gone from 5.25% to just over 6%, an increase of almost 1% in one month.
“The Bank of Canada will not need to intervene much more for this situation to begin to influence variable rates as well,” added the economist.