RE/MAX Canada anticipates a steady fall market for
majority of regions across the country
- Residential sale price expected to increase between one and six
per cent this fall in 76 per cent of RE/MAX broker regions
surveyed
- While average residential sale prices are likely to increase in
the majority markets analyzed, there are a couple of outliers
where prices are anticipated to be flat or decline, including
Toronto, Hamilton, Burlington, Kitchener-Waterloo, Charlottetown, North
Bay and London
- 25 per cent of Canadians expressed that saving for a home
purchase is one of their top three priorities when it comes to
financial savings, despite high cost of living and affordability
challenges
TORONTO, Sept. 3,
2024 /CNW/ -- With the long-anticipated decline in
interest rates finally starting to materialize, early indicators
from RE/MAX brokers and agents across Canada suggest steady housing market activity
this fall. Average sale prices across all housing types are
expected to increase between one and six per cent in the majority
of regions by year's end, according to RE/MAX's 2024 Fall
Housing Market Outlook.
Ahead of the next Bank of Canada (BoC) interest rate announcement on
September 4, two in 10 Canadians (16
per cent) said they will feel more comfortable engaging in the real
estate market once they see there is more than a 100-basis-point
cut to the BoC's lending rate between now and the end of the year,
according to a Leger survey commissioned by RE/MAX as part of the
report.
"The fall market is usually a good early indicator for activity
as we look ahead to early 2025, and we're headed toward more
healthy territory. With interest rates starting to ease, buyers are
beginning to come off the sidelines," says Christopher Alexander, President, RE/MAX
Canada. "That's not to say the
fall market will be in full swing according to historic standards.
Consumers will drive that trend, so we'll need to see a bigger move
by the Bank of Canada for that to
happen."
Consumer Sentiments Going into the Fall Market
Ahead of further anticipated interest rate cuts by the Bank of
Canada, it seems that even the
mere prospect of lower rates has boosted confidence among
first-time homebuyers, with one-quarter of Canadians (25 per cent)
actively saving for a home purchase and confident they will be able
to buy soon (with the majority being younger Millennials and Gen Zs
aged 18-24, at 35 per cent). On the flipside, dropping interest
rates now may prove too little, too late for some current
homeowners, with 14 per cent saying they need to renew their
mortgage soon, and with the current higher interest rate, they may
need to sell their home.
When it comes to financial savings, the Leger survey revealed
that while a home purchase is listed among the top three priorities
for 25 per cent of Canadians, it has taken a back seat to
day-to-day expenses such as utilities and food (58 per cent), and
travel (45 per cent).
In the search for affordability, one-quarter of Canadians say
that they are considering moving to another country (28 per cent)
and 25 per cent say they are reconsidering whether to have children
or start a family due to housing affordability challenges.
"Despite some consumer confidence starting to return to the
market this season, the reality is Canadians are still grappling
with some serious housing affordability challenges rooted in lack
of supply. Yes, borrowing is becoming less expensive, but this
won't make housing affordable in the long run," says Alexander.
"Markets ebb and flow, and as buyers re-enter the market and absorb
inventory, we'll see more upward pressure on price.
"Ultimately, for the long-term health of Canada's housing market, we need a national
housing strategy developed in collaboration between all levels of
government, that's more strategic and visionary in how we can use
existing lands and real estate to boost supply. In the meantime,
buyers would be wise to work with an experienced real estate agent
to help navigate those cyclical market ups and downs that often
accompany this push and pull of supply and demand."
Regional Market Insights
As part of the 2024 Fall Housing Market Outlook Report, RE/MAX
brokers and agents in Canada were
asked to share an analysis of their local market between January
and July 2023 and 2024 and share
their estimated outlook for fall 2024. The majority of regions (76
per cent) anticipate an increase in sale price between one to six
per cent, including Greater Vancouver
Area, BC; Calgary, AB;
Edmonton, AB; Saskatoon, SK; Winnipeg, MB; Halifax, NS; St.
John's Metro, NL; Truro/Colchester, NS; Fredericton, NB; Timmins, ON; Sudbury, ON; Brampton, ON; Mississauga, ON; Niagara, ON; Ottawa, ON; Durham,
ON; Barrie, ON; Muskoka,
ON; Peterborough, ON; York Region,
ON; Kingston, ON; Windsor, ON, and Thunder Bay, ON. Exceptions to the upward
trend include Toronto, ON;
Hamilton, ON; Burlington, ON; and Kitchener-Waterloo, ON, where a moderate
decline between two and three per cent is expected, and
Charlottetown, PEI; North Bay, ON, and London, ON, where prices will likely remain
flat.
When it comes to listings, a majority of regions surveyed (82
per cent) saw the number of listings increase between 2.3 and 34.7
per cent between January and July (2023 – 2024). The number of sale
transactions also increased between 3.1 and 7.4 per cent in
Atlantic Canada, 3.4 to 30.9 per
cent in Western Canada, and
between 0.6 and 14.8 per cent in Ontario, except for some larger Ontario markets like Toronto, Brampton, Durham Region, Mississauga, Peterborough and York Region, where sales
trended downward.
According to RE/MAX brokers' insights, 33 per cent of housing
markets are expected to be seller's markets, but this may shift as
competition increases and market conditions evolve.
To view the regional data table, click here.
Western Canada and
Prairies
The Prairies continue to skew towards a seller's market
(Edmonton, AB; Calgary, AB; Saskatoon, SK) which is consistent with 2023,
except for Winnipeg, MB, which is
a balanced market. On the other hand, in Western Canada, inclusive of the Greater Vancouver Area, BC, and Kelowna, BC, a mix of balanced and buyer's
markets are anticipated. Heading into the fall, prices are
forecasted to increase by two to six per cent in regions like the
Greater Vancouver Area, BC,
and Kelowna, BC; Calgary, AB;
Edmonton, AB; Saskatoon, SK; and Winnipeg, MB. Sale transactions are
anticipated to increase by five to 15 per cent in the Greater Vancouver Area, BC; Edmonton, AB; and Winnipeg, MB; and a decrease of one per cent
in Saskatoon, SK, due to inventory
shortages, while Calgary, AB
anticipates sales will remain flat. RE/MAX broker feedback in
Regina, SK indicates that many
factors will dictate how the market pans out for the remainder of
the year, including government election cycles, The Bank of
Canada interest rate announcements
and inventory levels. Historically, Regina, SK sees the markets cool from
mid-September through the end of the year.
All markets in Western Canada
and The Prairies – apart from the Greater
Vancouver Area, BC - continue to experience supply
challenges, with increased activity in the market, as consumers
benefit from recent interest rate cuts. Lower mortgage rates have
bolstered consumer confidence in the market but paired with
low supply, RE/MAX brokers and agents in the region are
reporting aggressive offers in conjunction with sellers raising
asking prices for residential homes.
Ontario
Despite The Bank of Canada's
interest rate cuts, low housing supply continues to impact multiple
markets across Ontario, keeping
prices high. However, some buyers are gaining more confidence as
mortgage rates decrease and are slowly re-entering the market
heading into fall, keeping prices relatively stable in comparison
to the year prior. Housing supply is expected to become a larger
issue once further interest rate cuts motivate buyers on the
sidelines to re-enter the market and spark more competition.
Although some homebuyer confidence is starting to return, buyers
in Toronto remain hesitant as
affordability continues to be a challenge, especially for
first-time homebuyers.
Across Ontario, 12 regions are
expecting average residential prices to remain flat or increase
modestly heading into the fall. Increasing markets include
Timmins, Sudbury, Brampton, Mississauga, Thunder
Bay, and Barrie (each
rising five per cent), Peterborough, York Region and Kingston (rising three per cent), Niagara (up
two per cent), Durham Region and Ottawa (up one per cent), and London (rising a nominal 0.5 per cent). The
outliers to this upward trend are Toronto, Kitchener-Waterloo, Hamilton, and Burlington, which are expecting a price
decrease.
In Ontario, seven markets are
expected to experience balanced conditions this fall, while four
are anticipated to be seller's markets, and five are buyer's
markets. Four markets are expecting a mix, with three
buyers/balanced conditions, and one sellers/balanced market.
Atlantic Canada
Echoing similarities to other regions across Canada, Atlantic
Canada is also reporting low inventory supply and increased
competition when it comes to buyer activity. Buyers are competing
aggressively on affordable housing and new listings, causing prices
to spike. This is likely a result of current supply challenges and
an increase in out-of-town buyers from Western and Central Canada.
Unlike in 2023, average residential prices in Atlantic Canada are expected to increase for
the remainder of year, by five per cent in Truro and Colchester, NS, one per cent in Halifax, NS, 1.5 per cent in St. John's Metro, NL, and two per cent in
Fredericton, NB, while
Charlottetown, PEI is anticipated
to remain flat. All markets in Atlantic
Canada with the exception of Charlottetown - which is a buyer's market -
are considered to be seller's markets.
Quebec
Like other regions across the country, Montreal's housing shortage coupled with
interest rates have resulted in a seller's market, with buyers
making multiple offers on properties to remain competitive or
opting to wait on the sidelines. Pricing and marketing are crucial
for sellers looking to attract hesitant buyers.
Additional survey findings:
- Majority of Canadians (77 per cent) believe steps taken by
municipal, provincial, and federal governments to improve housing
inventory and affordability are not enough to solve our
affordability crisis and more needs to be done
- 60 per cent of Canadians believe building more diverse types of
housing are the key to solving Canada's housing supply challenges
- For 16 per cent of Canadians, rising cost-of-living and
affordability challenges have not deterred them at all, and they
plan to purchase another home beyond their primary residence soon
(or have recently)
- 40 per cent of Canadians feel Canada is one of the best countries in the
world to purchase/invest in real estate (notably this number is
higher at 52 per cent, for new Canadians that have been in
Canada for less than 5 years)
- One-third of Canadians (32 per cent) said they are relying on
their home as their only financial plan for retirement.
About Leger
Leger is the largest Canadian-owned full-service market research
firm. An online survey of 1,530 Canadians aged 18 years or older,
was completed between August 9 and 11,
2024, using Leger's online panel. Leger's online panel has
approximately 400,000 members nationally and has a retention rate
of 90 per cent. A probability sample of the same size would yield a
margin of error of +/-2.5 per cent, 19 times out of 20.
About the RE/MAX Network
As one of the leading global real estate franchisors, RE/MAX,
LLC is a subsidiary of RE/MAX Holdings (NYSE: RMAX) with more than
140,000 agents in almost 9,000 offices with a presence in more than
110 countries and territories. RE/MAX Canada refers to RE/MAX of Western Canada (1998), LLC and RE/MAX
Ontario-Atlantic Canada, Inc., and RE/MAX Promotions,
Inc., each of which are affiliates of RE/MAX, LLC. Nobody in the
world sells more real estate than RE/MAX, as measured by
residential transaction sides.
RE/MAX was founded in 1973 by Dave and
Gail Liniger, with an innovative, entrepreneurial culture
affording its agents and franchisees the flexibility to operate
their businesses with great independence. RE/MAX agents have lived,
worked and served in their local communities for decades, raising
millions of dollars every year for Children's Miracle Network
Hospitals® and other charities. To learn more about
RE/MAX, to search home listings or find an agent in your community,
please visit remax.ca. For the latest news from RE/MAX
Canada, please visit
blog.remax.ca.
Forward looking statements
This report includes "forward-looking statements" within the
meaning of the "safe harbour" provisions of the United States
Private Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of words such as "believe,"
"intend," "expect," "estimate," "plan," "outlook," "project," and
other similar words and expressions that predict or indicate future
events or trends that are not statements of historical matters.
These forward-looking statements include statements regarding
housing market conditions and the Company's results of operations,
performance and growth. Forward-looking statements should not be
read as guarantees of future performance or results.
Forward-looking statements are based on information available at
the time those statements are made and/or management's good faith
belief as of that time with respect to future events and are
subject to risks and uncertainties that could cause actual
performance or results to differ materially from those expressed in
or suggested by the forward-looking statements. These risks and
uncertainties include (1) the global COVID-19 pandemic, which has
impacted the Company and continues to pose significant and
widespread risks to the Company's business, the Company's ability
to successfully close the anticipated reacquisition and to
integrate the reacquired regions into its business, (3) changes in
the real estate market or interest rates and availability of
financing, (4) changes in business and economic activity in
general, (5) the Company's ability to attract and retain quality
franchisees, (6) the Company's franchisees' ability to recruit and
retain real estate agents and mortgage loan originators, (7)
changes in laws and regulations, (8) the Company's ability to
enhance, market, and protect the RE/MAX and Motto Mortgage brands,
(9) the Company's ability to implement its technology initiatives,
and (10) fluctuations in foreign currency exchange rates, and those
risks and uncertainties described in the sections entitled "Risk
Factors" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in the most recent Annual
Report on Form 10-K and Quarterly Reports on Form 10-Q filed with
the Securities and Exchange Commission ("SEC") and similar
disclosures in subsequent periodic and current reports filed with
the SEC, which are available on the investor relations page of the
Company's website at www.remax.com and on the SEC website at
www.sec.gov. Readers are cautioned not to place undue reliance on
forward-looking statements, which speak only as of the date on
which they are made. Except as required by law, the Company does
not intend, and undertakes no duty, to update this information to
reflect future events or circumstances.
SOURCE RE/MAX Canada