{"id":24352,"date":"2024-08-01T10:10:49","date_gmt":"2024-08-01T17:10:49","guid":{"rendered":"https:\/\/www.roryc.ca\/blog\/?p=24352"},"modified":"2024-08-01T07:31:36","modified_gmt":"2024-08-01T14:31:36","slug":"the-real-home-buyers-arent-truly-exist-for-a-buyers-market","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2024\/08\/the-real-home-buyers-arent-truly-exist-for-a-buyers-market\/","title":{"rendered":"The Real Home Buyers Aren&#8217;t Truly Exist for A Buyers&#8217; Market"},"content":{"rendered":"<p style=\"text-align: justify;\">In major Canadian real estate markets like Toronto, Vancouver, and the Fraser Valley, inventory levels are surging. It appears that last month\u2019s interest rate cut was enough (or not enough for those in need of a bigger cut) to coax many sellers back into the market, giving would-be homebuyers more choice and pushing conditions towards buyers\u2019 market territory.<\/p>\n<p style=\"text-align: justify;\">There\u2019s one major caveat, though : buyers aren\u2019t really biting.<\/p>\n<p style=\"text-align: justify;\">The latest figures from the Toronto Regional Real Estate Board, released earlier this month, showed that sales slumped 16.4% on a year-over-year basis in June, with just 6,213 transactions recorded. Things were similarly quiet in Vancouver and the Fraser Valley, where there were just 2,395 and 1,317 sales recorded respectively in the month, representing annual declines of 19% and 30%.<\/p>\n<p style=\"text-align: justify;\">By contrast, new listings surged to 17,964 in Toronto, 5,723 in Vancouver, and 3,418 in the Fraser Valley.<\/p>\n<p style=\"text-align: justify;\">Taking all of those figures into account, the sales-to-new-listing ratio \u2014 calculated by dividing the number of homes sold by the number of new listings recorded \u2014 clocked in at around 34.6% in Toronto, 41.8% in Vancouver, and 38.5% in the Fraser Valley. Anything under 40% suggests a buyer-friendly market, while a ratio between 40% and 60% indicates that buying and selling conditions are more balanced. Conversely, a ratio that\u2019s 60% or higher indicates a sellers\u2019 market.<\/p>\n<p style=\"text-align: justify;\">While, \u201cin theory\u201d we\u2019re either already in or on the cusp of a buyers\u2019 territory in these major Canadian markets, John Lusink, President of Right at Home Realty and Property.ca points out that \u201cfor a buyers\u2019 market to truly exist, you need to have real buyers.\u201d<\/p>\n<p style=\"text-align: justify;\">Underscoring how slow things are these days, Lusink points to \u201cCOVID times,\u201d when his brokerages were seeing half amount of listings, but around 25% more transactions. His take on the matter is that there is plenty of pent-up demand \u2014 buyers do want to buy \u2014 but in many cases, they aren\u2019t able to qualify in the current interest rate environment. And despite the fact that interest rates are finally starting to come down, he warns that it will take mortgage rates some time to catch up.<\/p>\n<p style=\"text-align: justify;\">\u201cThe question is: at what point will buyers then be able to return to the market? Is that going back to when mortgage rates were in that 3.5% to 4% range? Yeah, that probably would help. We&#8217;re sort of in the low- to mid-sixes at the moment, depending on what product you choose,\u201d Lusink says. \u201cI think the sense also is that prices need to come down for buyers to say, \u2018okay, I&#8217;m stepping up.\u2019\u201d<\/p>\n<p style=\"text-align: justify;\">Although Lusink\u2019s thinking is that the BoC will lower the policy interest rate again this week \u2014 the next announcement is on Wednesday the 24th \u2014 he doesn\u2019t think that will be enough to entice buyers to, well, buy. Not yet, anyways. Ross McCredie, President and CEO of Sutton Group, is in the same camp, telling STOREYS that while he thinks a rate cut would have an effect on market sentiment, he doesn\u2019t think it will open the floodgates, so to speak, as far as actual home sales go.<\/p>\n<p style=\"text-align: justify;\">Interest rates are just one piece of the larger housing in-affordability puzzle, McCredie says. \u201cYou\u2019ve had interest rates go up very, very fast\u2026 and then you\u2019ve also had your property insurance go up, your HOA fees go up. When you add all [those costs] up, people are seriously thinking, \u2018well, maybe I don&#8217;t need to buy a house, maybe I should rent a condo or something like that.\u2019\u201d<\/p>\n<p style=\"text-align: justify;\">Even so, McCredie anticipates that home-buying activity will pick up to an extent in the fall and winter, which is when many mortgage holders will be up for renewal. \u201cPeople are going to start having to really cut back or consider selling their home and moving into something smaller,\u201d he says. \u201cAnd so you&#8217;ll see people that have probably been sitting on the fence wanting to buy, who will step forward and buy.\u201d<\/p>\n<p style=\"text-align: justify;\">\u201cDemand is still there,\u201d McCredie adds. \u201cI mean, we had a million new people come to Canada this year \u2014 that&#8217;s an extraordinarily high number, and it&#8217;s putting a lot of pressure on housing.\u201d<\/p>\n<p style=\"text-align: justify;\">For the time being, Lusink urges those in the market to purchase a home to take advantage of the emerging buyers\u2019 market conditions, including more choice, and the luxury of time. \u201cYou finally have a little bit of time to study what&#8217;s out there, get pre-approved, put in your conditions\u2026 all of that good stuff,\u201d he says. \u201cThere are also opportunities in the new construction area where, unfortunately, people aren&#8217;t able to close or maybe closed but really aren&#8217;t able to hang on. I think there&#8217;s just lots more opportunity.\u201d<\/p>\n<p><a href=\"https:\/\/storeys.com\/buyers-market-buyers-arent-biting\/\" target=\"_blank\" rel=\"noopener\">Canadian Cities are Moving Into Buyers&#8217; Markets, But Experts Say That Buyers aren&#8217;t Biting<\/a> by Zakiya Kassam | Storeys<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In major Canadian real estate markets like Toronto, Vancouver, and the Fraser Valley, inventory levels are surging. It appears that last month\u2019s interest rate cut was enough (or not enough &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2024\/08\/the-real-home-buyers-arent-truly-exist-for-a-buyers-market\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,13],"tags":[],"class_list":["post-24352","post","type-post","status-publish","format-standard","hentry","category-market-updates","category-real-estate"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>The Real Home Buyers Aren&#039;t Truly Exist for A Buyers&#039; Market &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2024\/08\/the-real-home-buyers-arent-truly-exist-for-a-buyers-market\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"The Real Home Buyers Aren&#039;t Truly Exist for A Buyers&#039; Market &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"In major Canadian real estate markets like Toronto, Vancouver, and the Fraser Valley, inventory levels are surging. It appears that last month\u2019s interest rate cut was enough (or not enough &hellip; [read more]\" \/>\n<meta name=\"twitter:creator\" content=\"@RoryClipsham\" \/>\n<meta name=\"twitter:site\" content=\"@RoryClipsham\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Rory Clipsham\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2024\\\/08\\\/the-real-home-buyers-arent-truly-exist-for-a-buyers-market\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2024\\\/08\\\/the-real-home-buyers-arent-truly-exist-for-a-buyers-market\\\/\"},\"author\":{\"name\":\"Rory Clipsham\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"headline\":\"The Real Home Buyers Aren&#8217;t Truly Exist for A Buyers&#8217; 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