More competition expected as buyers re-enter housing market

Mortgage brokers say the latest housing market data from the Canadian Real Estate Association (CREA) suggests homebuyers have largely come off the sidelines, adding that competition is expected to heat up going forward.

 

Bloomberg News reported on Friday that Canadian home sales hit a two-year peak in October following a series of rate cuts by the Bank of Canada that has pulled buyers back into the market. CREA data for October showed the number of transactions rose 7.7 per cent compared to the previous month, the highest level since April 2022. However, the benchmark home price fell by 0.1 per cent to $716,800.

 

“We’ve seen a notable surge in sales alongside a decline in new listings. This, combined with new mortgage rules coming into effect on Dec. 15 and the Bank of Canada’s anticipated rate cuts next month, will further heat up competition,” Leah Zlatkin, a licensed mortgage broker and LowestRates.ca expert, said in a statement to BNNBloomberg.ca Monday.

She added that the number of pre-approvals has significantly increased as many buyers are no longer waiting for lower interest rates.

 

“Homebuyers who were sitting on the sidelines are now actively engaging, weighing their options, and asking critical questions about whether fixed or variable rates best suit their needs in this evolving environment,” Zlatkin said.

 

“For those considering a home purchase, the window of opportunity is closing. Now is the ideal time to act before the market tilts decisively in favour of sellers.”

 

Victor Tran, a RATESDOTCA mortgage and real estate expert, said in a statement to BNNBloomberg.ca that the housing market is beginning to pickup, which is “good news for both buyers and sellers.”

 

“If the Bank of Canada makes another jumbo rate cut in December, we could see a turning point in buyer psychology that could drive a busy winter season,” he said.

 

He also noted that a number of buyers are still looking to enter the market.

 

“They have pre-approvals and are looking for the right moment and the right property to purchase,” Tran said.

 

“Once the tide turns and buyers enter the market en masse, we will likely see the market heat up quickly, and a corresponding rise in home prices.”

 

 

 

 

This article was first reported by BNN Bloomberg