A Good Month for Home Sales, and A Small Win for New Home Builds

This week’s top real estate stories.

By  Jared Lindzon | 2 minute read

Every Friday, Wahi brings you the most important real estate stories from the past week.

Patience is a Virtue for GTA Sellers

If slow and steady wins the race then save room on the podium for the GTA, where homes are selling at tortoise-like speeds. According to our latest data, it is taking longer to find a buyer in 86% of the region’s roughly 400 neighbourhoods compared to last year, averaging 28 days, though there are some outliers. In Q3, homes in Raymerville, Markham, only lasted 10 days on the market, while five others tied for second at 11. On the other end of the spectrum, homes in Freeman, Burlington, and the Oakville Business Corridor languished for an average of 63 days.

Canada’s October Surprise  

When the housing market is this slow any activity is considered a surprise and in the run-up to Halloween, Canadians got something of a jump scare. Last Friday, CREA announced a 7.7% increase in home sales for October, compared to September, making it the most active sales month in the country since April of 2022. According to CREA, however, it wasn’t last month’s 50-basis point rate cut that caused the sales surge, but rather an abundance of inventory, which reached the highest level seen since mid-2022, that pushed prices down 0.1% month-over-month and 2.75% year-over year. 

Inflation Takes a Step Back 

What was a sure bet days ago has become more of a gamble as the market reacts to some less than stellar inflation data. In September the consumer price index hit its lowest point in years, dropping to just 1.6%, raising hopes of another major half-point rate cut. This week Statistics Canada is back with some less optimistic news, announcing Wednesday that inflation jumped to 2% in October. That’s called into question the likelihood of a half-point rate cut in December. While the odds of a 50-bps cut have dropped, economists say there’s still hope — just a little less.

Housing Starts Winning the Battle, Losing the War  

New home construction data is giving serious ‘highlight-worthy goal in a 10-1 beating’ energy. On Monday CMHC celebrated an 8% spike in new home builds for October, and a 22% increase on a seasonally adjusted basis since August, but conceded little change in major urban centres since last year. In fact, Ontario and B.C. were down 18% and 11% in year-to-date housing starts, while Toronto and Vancouver saw housing development decline 44% and 30% respectively. Despite the small victory, new home construction remains well below levels needed to move the needle on affordability, especially in places it’s needed most.

Rent Declines for All the Wrong Reasons  

Rent is coming down, but not for reasons worth celebrating. According to a new report by Desjardins, rents have been outpacing inflation in Canada’s major cities at the fastest pace since the 1980s, but that’s about to change, thanks to rising unemployment and slower population growth. According to the report, less immigration will slow the pace of rent inflation in the years ahead, especially in Calgary and Edmonton, though it’s expected to remain elevated in Quebec. The report also warns that the change of pace is only temporary, and that increasing supply is the only sustainable solution to housing shortages.

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