The Canadian housing market saw a slowdown in housing starts and residential home sales in April 2024, according to reports from the Canada Mortgage and Housing Corporation (CMHC) and the Canadian Real Estate Association (CREA).
The CREA reported that home sales in April decreased by 1.7% compared to March 2024, although they remained higher than the previous year. The number of newly listed homes rose by 2.8% month-over-month, leading to a 6.5% increase in the overall number of properties on the market, reaching its highest level since the beginning of the COVID-19 pandemic.
Related: Is the Capital Gains Tax Change Flooding the Housing Market with Listings?
ITSO data shows listings jump in three out of four categories compared to their 10-year and 15-year averages. Townhouses saw a 42% jump compared to their 10-year average, while semi-detached homes and condos witnessed a 37% and 48% increase, respectively, compared to their 10-year and 15-year averages. Single-family homes, however, saw a slight decline of 0.9% compared to the average.
CMHC reported that the annual rate of housing starts dropped by 1% from March to April, with the six-month average measure of trends also decreasing by 2.2%. Actual new housing construction, not seasonally adjusted, also fell in Toronto, Vancouver, and Montreal for both multi-unit and single-detached homes compared to the previous year.
Related: Housing Starts Fall 7% Across Canada In March On Seasonally Adjusted Basis
Economists attribute the slowdown in housing starts and sales to elevated borrowing costs and uncertainty surrounding the Bank of Canada’s decision on rate cuts.
However, they anticipate a stronger second half of the year, with the expectation of rate cuts in the summer. Nonetheless, affordability conditions in several markets, particularly in BC and Ontario, may continue to weigh down the pace of growth in both sales and prices.
Information for this story was found via CMHC, CREA, ITSO, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
