The Canadian real estate market is dynamic as of late 2024, influenced by both stabilizing prices and shifts in buyer behaviour. Here’s a look at some key factors shaping the market, both positively and negatively.
Positive Factors
Increased Listings: An increase in new property listings, especially in cities like Toronto, Vancouver, and Montreal, provides potential buyers with more choices. Inventory levels have been rising, allowing the market to approach a more balanced state.
Rate Cuts Expected: While the Bank of Canada recently cut rates by 75 basis points, more reductions are anticipated. This should eventually help ease mortgage costs, supporting buyer confidence. Additionally, the upcoming 30-year amortization option for insured mortgages in December will further improve affordability.
Market Balance: A balanced sales-to-new-listings ratio (SNLR) of around 54% suggests that the market is not drastically skewed in favor of buyers or sellers, providing a stable environment for transactions in most regions.
Negative Factors
High Interest Rates: Despite recent cuts, borrowing costs remain high compared to pre-pandemic levels, putting pressure on homebuyers, especially in the priciest markets. This has led many first-time buyers to pause their search until the anticipated rate cuts provide more relief.
Affordability Challenges: In areas like Vancouver and Toronto, the high cost of living and home prices remain a significant barrier. Even with slight price reductions, the gap between earnings and mortgage payments continues to pose challenges for prospective buyers.
Economic Uncertainty: Rising unemployment rates and economic shifts may make buyers and sellers more cautious, influencing market activity in certain regions. The forecasted economic slowdown could further affect demand, especially in higher-priced urban centers.
Key Trends to Watch
Regional Variances: Cities like Calgary and Edmonton are showing more resilient demand and even price growth in certain segments, contrasting with the more stagnant or cooling conditions in places like Toronto and Vancouver.
2025 Outlook: As rates potentially ease further and new policies come into effect, experts anticipate a moderate rebound in market activity in 2025, especially if economic conditions stabilize.
Conclusion
Whether buying or selling, Canadian real estate in late 2024 requires strategy and insights. Understanding the evolving landscape will help you make informed decisions that align with your goals.
Get The Abbott Advantage: With over 25 years of real estate experience, Chris Abbott brings the expertise, negotiation skills and his $mart $elling $ystem to guide you through the current market. Reach out for your complimentary home evaluation today!
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