According to a survey of brokers and agents, 25 out of 30 said that this year’s activity in their local residential market had been impacted by rising interest rates, with some saying that this had been the biggest factor affecting home buyer and seller confidence. This trend is likely to continue for the rest of 2022. These conclusions are corroborated by a recent Leger survey commissioned by a real estate agent Brampton, which finds that 44% of Canadians will delay purchasing a home this fall due to rising interest rates, compared to 34% who won’t.
Lack of home supply
- Despite the fact that there is currently a severe lack of home supply in the Canadian housing market, several locations are seeing a decline in sales activity as a result of recent interest rate increases.
- According to a real estate agent in Brampton, “this offers some relief from the unprecedented demand and unsustainable price increases we’ve seen across Canada through 2021 and in early 2022.
- “However, the current pause in the market is merely temporary. These “boom” and “bust” cycles will probably continue until the supply of housing grows.
Positive impact could happen
- The fact that over half of Canadians are delaying their home purchase or sale, top realtors in Mississauga are optimistic that activity will pick up as economic conditions improve by mid-2023.
- Timing the short-term investment market is quite challenging.However, the Canadian housing market continues to offer good returns as a long-term investment.
- Regardless of these cyclical peaks and valleys, customers may make the best choice whether they need to buy or sell a home by doing their research and working with a seasoned real estate expert.
Situation Of Canada’s West and the Prairies
- Rising interest rates have been affecting local market activity in areas like Vancouver, BC, Victoria, BC, Kelowna, BC, and Edmonton, AB, according to top realtors in Mississauga. This has led to a decline in consumer confidence, a decrease in multiple offers from buyers, and a shift toward more balanced conditions between buyers and sellers.
- The average residential sale price is anticipated to decrease between zero and 6.5% in all Western Canada and Prairie regions except Calgary, Alberta, and Edmonton, Alberta.
Due to the relative affordability of the area, interest rate increases and concerns about a recession have not had a significant impact on the market in Calgary, Alberta. As a result, during the rest of the year, a small three percent price increase is anticipated.
Ontario has experienced the effects of increased interest rates much like other states and provinces in the nation. Many markets, such as Oakville, Windsor, Barrie, Durham, Kingston, and Kitchener-Waterloo, expect – and in some cases are already experiencing – a decline in the number of units sold over the upcoming months. With the exception of Oakville and Muskoka, average home sale prices in Ontario are predicted to remain stable or drop by two to ten percent in the fall.
Similar to Western Canada, Oakville’s luxury market has remained robust and in-demand among buyers despite rising interest rates and an impending recession. This has contributed to the modest two percent increase in the city’s average residential sale price that is anticipated this fall. Homebuyers continue to flock to Muskoka said by a real estate agent in Brampton,
Condition Of Others Province
In Edmonton, Alberta, homes priced between $500,000 and $1,000,000 have been most affected by rising interest rates, whereas those priced at $400,000 or less are still reasonably priced according to the current economic climate.
For the rest of the year, Edmonton’s prices are probably going to rise by a modest 1.5%. Interest rate increases have had little effect on the demand for luxury properties in either Vancouver, BC, or Edmonton, AB, where it has remained stable. This is anticipated to last well into the fall. In many areas it is predicted that low inventory continues to be a major problem and is anticipated to drive up property prices.